WGU C213 Pre Assessment 2022
What does accounting focus on? - The impact a business's activities have on its overall
financial performance
Which report summarizes cash collections and cash expenditures from operating,
investing, and financing activities over a period of time? - Statement of cash flows
Which users would have a primary concern with an organization's ability to provide
healthcare benefits? - Employees
Which body regulates a certified public accounting firm's audit practices when the firm is
auditing a large publicly traded company? - The Public Company Accounting Oversight
Board (PCAOB)
What has had the most significant impact on accounting practices? - Information
technology
What two items of information are revealed on the balance sheet?
Choose 2 answers - Ownership.
Debt
Which term is defined as the residual interest in the net assets of a company? - Owners'
equity
A corporation has total liabilities of $300 million, total owners' equity of $100 million, and
current assets of $50 million.
What is the value of the firm's long-term assets? - $350 million
Which situation should result in revenue recognition on the income statement for the
year ending 12/31/14 if the firm is using accrual-basis accounting? - In 2014, a company
provides services to a customer for which cash will be collected the next year (2015).
Which category on the statement of cash flows summarizes cash receipts and
payments to owners and creditors of the company? - Cash flows from financing
activities
Where would an investor find a summary of a company's significant accounting
policies? - In the notes to financial statements
Which assurance does an external audit report provide for its readers? - The company's
financial statements fairly reflect its financial position
Reliable - Information that can be verified
, Relevant - Information having to do with the matter at hand
Material - Information that is important enough to make a difference
Conservatism - Information related to recognizing losses as they occur
What are steps in the decision cycle? - 1 Prepare financial statements.
2 Analyze financial statements.
3 Gather information.
4 Make decision.
5 Implement decision.
Partial financial information for a company is as follows:
Current assets $36,543
Total assets $58,719
Current liabilities $24,824
Total liabilities $48,561
Stockholders' equity $10,158
Sales $46,997
Net Income $ 3,761
Market value of shares $41,316
What is the price-earnings (PE) ratio for this company? - 11.0
What is consistent with a continual decline in gross profit if the firm's cost of goods sold
remains the same? - Continual decrease in sales
Which two cash flow adequacy ratios represent a cash cow? - $6,991/$5,486.
$5,220/$1,875.
Which formula yields a cash times interest earned ratio of 11? - Cash before interest
and taxes of $11,000 / cash paid for interest of $1,000
Which form of debt should be reported in the long-term liability category? - Notes
payable expected to be paid in 18 months
In January of year 1, a company began doing business as a corporation in order to sell
technology-related accessories and services. During its first month of operations, the
following events occurred:
January 1
The corporation received $1,000,000 in cash in exchange for stock issued to
stockholders.
January 3
What does accounting focus on? - The impact a business's activities have on its overall
financial performance
Which report summarizes cash collections and cash expenditures from operating,
investing, and financing activities over a period of time? - Statement of cash flows
Which users would have a primary concern with an organization's ability to provide
healthcare benefits? - Employees
Which body regulates a certified public accounting firm's audit practices when the firm is
auditing a large publicly traded company? - The Public Company Accounting Oversight
Board (PCAOB)
What has had the most significant impact on accounting practices? - Information
technology
What two items of information are revealed on the balance sheet?
Choose 2 answers - Ownership.
Debt
Which term is defined as the residual interest in the net assets of a company? - Owners'
equity
A corporation has total liabilities of $300 million, total owners' equity of $100 million, and
current assets of $50 million.
What is the value of the firm's long-term assets? - $350 million
Which situation should result in revenue recognition on the income statement for the
year ending 12/31/14 if the firm is using accrual-basis accounting? - In 2014, a company
provides services to a customer for which cash will be collected the next year (2015).
Which category on the statement of cash flows summarizes cash receipts and
payments to owners and creditors of the company? - Cash flows from financing
activities
Where would an investor find a summary of a company's significant accounting
policies? - In the notes to financial statements
Which assurance does an external audit report provide for its readers? - The company's
financial statements fairly reflect its financial position
Reliable - Information that can be verified
, Relevant - Information having to do with the matter at hand
Material - Information that is important enough to make a difference
Conservatism - Information related to recognizing losses as they occur
What are steps in the decision cycle? - 1 Prepare financial statements.
2 Analyze financial statements.
3 Gather information.
4 Make decision.
5 Implement decision.
Partial financial information for a company is as follows:
Current assets $36,543
Total assets $58,719
Current liabilities $24,824
Total liabilities $48,561
Stockholders' equity $10,158
Sales $46,997
Net Income $ 3,761
Market value of shares $41,316
What is the price-earnings (PE) ratio for this company? - 11.0
What is consistent with a continual decline in gross profit if the firm's cost of goods sold
remains the same? - Continual decrease in sales
Which two cash flow adequacy ratios represent a cash cow? - $6,991/$5,486.
$5,220/$1,875.
Which formula yields a cash times interest earned ratio of 11? - Cash before interest
and taxes of $11,000 / cash paid for interest of $1,000
Which form of debt should be reported in the long-term liability category? - Notes
payable expected to be paid in 18 months
In January of year 1, a company began doing business as a corporation in order to sell
technology-related accessories and services. During its first month of operations, the
following events occurred:
January 1
The corporation received $1,000,000 in cash in exchange for stock issued to
stockholders.
January 3
