WGU D196 Exam Prep/ (Top 2024/2025 EXAM REVIEW PAPERS / GRADED A+/ 100% Accurate)

WGU D196 Exam Prep What is the role and purpose of accounting ? - Role: To help track income and expenditures, and to provide investors, management, and government with financial information. Purpose: To accumulate, measure, and communicate financial information about businesses and other organizations. · Who uses accounting information and why? -Potential investors and creditors use accounting information, but basically everyone uses accounting information. They use it to make internal and external business decisions. · What are the important influences on accounting? -Important influences on accounting is the development of the "generally accepted accounting principles"(GAAP), international business and ethical consideration. · What is the role of ethics in accounting? -Being an accountant requires honesty and integrity, as well as professional judgement. So having ethics in accounting is very important. What are the three main functions of accounting? -The 3 main functions of accounting are: Analyzing, Bookkeeping, and Evaluating(ABE). The Financial Accounting Standards Board(FASB) - An organization responsible for studying accounting issues and establishing standards a) Private group b) Public process c) Establishes GAAP The Governmental Accounting Standards Board(GASB) -A private, non governmental organization who sets accounting and financial reporting standards for state and local governments Securities and Exchange Commission(SEC) -Regulates stock exchanges a) Has legal authority to regulate financial markets and accounting b) Usually defers to the FASB on accounting matters The Public Company Accounting Oversight Board(PCAOB) -Oversees all accounting firms. Internal Revenue Service(IRS) -Collects and regulates income taxes International Accounting Standards Board(IASB) -The FASB of the world(except the USA) Assets -assets are what we OWN. Common Assets: -) Cash -) Accounts receivable -) Inventory -) Buildings -) Prepaid Liabilities -An obligation to pay cash, transfer other assets, or provide services to someone. A) Liabilities are what we OWE. B) Common Liabilities: -) Accounts Payable -) Taxes Payable -) Mortgage Payable -) Unearned Revenue Owners Equity -The owners share of earnings.