WGU D196 Pre-Assessment/ (Top 2024/2025 EXAM REVIEW PAPERS / GRADED A+/ 100% Accurate)

WGU D196 Pre-Assessment What is a transaction? -Two parties exchanging something of value What is the effect of a company's accounting department maintaining high ethical standards? - The company's accounting information will increase in value. Why might employees be interested in their company's financial accounting information? - Financial statement data are often used in determining employee bonuses. Which group establishes financial accounting rules in the United States? -financial Accounting Standards Board (FASB) Which report is one of the three primary financial statements? -Assets decrease by $5,000; expenses increase by $5,000 A company borrowed $80,000 cash from a bank. How does this transaction affect the accounting equation of the borrowing company? -Assets increase by $80,000; liabilities increase by $80,000. A company paid $5,000 cash in advertising costs. How does this transaction affect the paying company's accounting equation? -Assets decrease by $5,000; expenses increase by $5,000. What is the impact of expenses on the accounting equation? -Expenses decrease owners' equity. Which type of account are accounts payable and notes payable both examples of? -Liability What is the purpose of the financial accounting cycle? -To turn information about transactions into financial statements According to the accounting equation, the amount of liabilities and equity must always be equal to another amount. What is that other amount? -Assets Which item is an expense item? -Cost of goods sold How is gross profit computed? -Sales minus cost of goods sol