WGU C213 PRE ASSESSMENT AND OBJECTIVE
ASSESSMENT EXAM 2024-2025 QUESTIONS WITH
DETAILED ANSWERS | LATEST UPDATE
The primary internal group that uses accounting information is? - CORRECT ANSWERManagement
Internal reports are generally used by? - CORRECT ANSWER Management
Which of the following is NOT an external user of financial information? - CORRECT
ANSWER Management
Which of the following is NOT true of the Financial Accounting Standards Board (FASB)? -
CORRECT ANSWER It is a government agency
Generally accepted accounting principles are? - CORRECT ANSWER Developed by
accounting rule makers
The current standard-setting board for accounting in the private sector is the? - CORRECT
ANSWER Financial Accounting Standards Board (FASB)
Which of the following organizations has specific legal authority to establish accounting
standards for publicly held companies? - CORRECT ANSWER Securities and Exchange
Commission (SEC)
Which of the following is NOT a service typically provided by large public accounting firms? -
CORRECT ANSWER Making management decisions
The initials CPA stand for? - CORRECT ANSWER Certified Public Accountant
, WGU C213 PRE ASSESSMENT AND OBJECTIVE
ASSESSMENT EXAM 2024-2025 QUESTIONS WITH
DETAILED ANSWERS | LATEST UPDATE
Standards established by the International Accounting Standards Board are referred to as? -
CORRECT ANSWER International Financial Accounting Standards
Which of the following is NOT a reason for the integration of worldwide accounting standards? -
CORRECT ANSWER the theoretical necessity of a common set of accounting standards
Increased federal oversight of the audit process resulted from the passage of the following act of
Congress? - CORRECT ANSWER Sarbanes-Oxley Act
What does it mean if a company has a debt ratio of 101.5%? - CORRECT ANSWER The
company has 1.5% more total liabilities than total assets.
What is consistent with a continual decline in gross profit if the firm's cost of goods sold remains
the same? - CORRECT ANSWER Continual decrease in sales
Which two cash flow adequacy ratios represent a cash cow? - CORRECT ANSWER
$6,991/$5,486 & $5,220/$1,875
What two items of information are revealed on the balance sheet? - CORRECT ANSWER
Ownership & Debt
Which term is defined as the residual interest in the net assets of a company? - CORRECT
ANSWER 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? - CORRECT
ANSWER $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? - CORRECT ANSWER In 2014, a
company provides services to a customer for which cash will be collected the next year (2015).
, WGU C213 PRE ASSESSMENT AND OBJECTIVE
ASSESSMENT EXAM 2024-2025 QUESTIONS WITH
DETAILED ANSWERS | LATEST UPDATE
Which category on the statement of cash flows summarizes cash receipts and payments to
owners and creditors of the company? - CORRECT ANSWER Cash flows from financing
activities
Cash flows from financing activities? - CORRECT ANSWER In the notes to financial
statements
Which assurance does an external audit report provide for its readers? - CORRECT ANSWER
The company's financial statements fairly reflect its financial position
Information that can be verified? - CORRECT ANSWER Reliable
Information having to do with the matter at hand? - CORRECT ANSWER Relevant
Information that is important enough to make a difference? - CORRECT ANSWER Material
Information related to recognizing losses as they occur? - CORRECT ANSWER Conservatism
Which form of debt should be reported in the long-term liability category? - CORRECT
ANSWER Notes payable expected to be paid in 18 months
What will be the impact of the January 5 event on the company's balance sheet on that date given
the following:
January 5 The corporation purchased equipment to be used in the business for $200,000 cash? -
CORRECT ANSWER Equipment will increase $200,000, and cash will decrease $200,000.
Which two values affect the measurement of net income? - CORRECT ANSWER Operating
expenses & Ordinary gains and losses
Which two items' subtotals are included in a multi-step income statement? - CORRECT
ANSWER Gross profit & Income from operations
, WGU C213 PRE ASSESSMENT AND OBJECTIVE
ASSESSMENT EXAM 2024-2025 QUESTIONS WITH
DETAILED ANSWERS | LATEST UPDATE
Given the following, which month should advertising costs be expensed by a company using
accrual based accounting: The furniture company paid $3,000 for advertising that ran in the local
newspaper in November 2011? - CORRECT ANSWER November 2011
What will be the total impact of services provided on the balance sheet other than an increase in
cash of $4,000 given the following:
Services were provided worth $10,000; customers paid $4,000 up front and promised the balance
next month? - CORRECT ANSWER Accounts receivable will increase $6,000 & Retained
earnings will increase $10,000
What was the 2012 net profit amount if the 2013 pro-forma net profit of $187,000 was based on
a 22% increase? - CORRECT ANSWER $153,279
What does accounting focus on? - CORRECT ANSWER 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? - CORRECT ANSWER Statement of cash flows
Which users would have a primary concern with an organization's ability to provide healthcare
benefits? - CORRECT ANSWER Employees
Which benefit does a corporation gain by following Generally Accepted Accounting Principles
(GAAP) - CORRECT ANSWER An increase in its comparability to other companies
Which of the following is the most correct definition of accounting? - CORRECT ANSWER A
system for providing quantitative information, primarily financial in nature, about economic
entities that is intended to be useful in making economic decisions
What is NOT typically true of accounting information? - CORRECT ANSWER The
information relates to future time periods.
ASSESSMENT EXAM 2024-2025 QUESTIONS WITH
DETAILED ANSWERS | LATEST UPDATE
The primary internal group that uses accounting information is? - CORRECT ANSWERManagement
Internal reports are generally used by? - CORRECT ANSWER Management
Which of the following is NOT an external user of financial information? - CORRECT
ANSWER Management
Which of the following is NOT true of the Financial Accounting Standards Board (FASB)? -
CORRECT ANSWER It is a government agency
Generally accepted accounting principles are? - CORRECT ANSWER Developed by
accounting rule makers
The current standard-setting board for accounting in the private sector is the? - CORRECT
ANSWER Financial Accounting Standards Board (FASB)
Which of the following organizations has specific legal authority to establish accounting
standards for publicly held companies? - CORRECT ANSWER Securities and Exchange
Commission (SEC)
Which of the following is NOT a service typically provided by large public accounting firms? -
CORRECT ANSWER Making management decisions
The initials CPA stand for? - CORRECT ANSWER Certified Public Accountant
, WGU C213 PRE ASSESSMENT AND OBJECTIVE
ASSESSMENT EXAM 2024-2025 QUESTIONS WITH
DETAILED ANSWERS | LATEST UPDATE
Standards established by the International Accounting Standards Board are referred to as? -
CORRECT ANSWER International Financial Accounting Standards
Which of the following is NOT a reason for the integration of worldwide accounting standards? -
CORRECT ANSWER the theoretical necessity of a common set of accounting standards
Increased federal oversight of the audit process resulted from the passage of the following act of
Congress? - CORRECT ANSWER Sarbanes-Oxley Act
What does it mean if a company has a debt ratio of 101.5%? - CORRECT ANSWER The
company has 1.5% more total liabilities than total assets.
What is consistent with a continual decline in gross profit if the firm's cost of goods sold remains
the same? - CORRECT ANSWER Continual decrease in sales
Which two cash flow adequacy ratios represent a cash cow? - CORRECT ANSWER
$6,991/$5,486 & $5,220/$1,875
What two items of information are revealed on the balance sheet? - CORRECT ANSWER
Ownership & Debt
Which term is defined as the residual interest in the net assets of a company? - CORRECT
ANSWER 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? - CORRECT
ANSWER $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? - CORRECT ANSWER In 2014, a
company provides services to a customer for which cash will be collected the next year (2015).
, WGU C213 PRE ASSESSMENT AND OBJECTIVE
ASSESSMENT EXAM 2024-2025 QUESTIONS WITH
DETAILED ANSWERS | LATEST UPDATE
Which category on the statement of cash flows summarizes cash receipts and payments to
owners and creditors of the company? - CORRECT ANSWER Cash flows from financing
activities
Cash flows from financing activities? - CORRECT ANSWER In the notes to financial
statements
Which assurance does an external audit report provide for its readers? - CORRECT ANSWER
The company's financial statements fairly reflect its financial position
Information that can be verified? - CORRECT ANSWER Reliable
Information having to do with the matter at hand? - CORRECT ANSWER Relevant
Information that is important enough to make a difference? - CORRECT ANSWER Material
Information related to recognizing losses as they occur? - CORRECT ANSWER Conservatism
Which form of debt should be reported in the long-term liability category? - CORRECT
ANSWER Notes payable expected to be paid in 18 months
What will be the impact of the January 5 event on the company's balance sheet on that date given
the following:
January 5 The corporation purchased equipment to be used in the business for $200,000 cash? -
CORRECT ANSWER Equipment will increase $200,000, and cash will decrease $200,000.
Which two values affect the measurement of net income? - CORRECT ANSWER Operating
expenses & Ordinary gains and losses
Which two items' subtotals are included in a multi-step income statement? - CORRECT
ANSWER Gross profit & Income from operations
, WGU C213 PRE ASSESSMENT AND OBJECTIVE
ASSESSMENT EXAM 2024-2025 QUESTIONS WITH
DETAILED ANSWERS | LATEST UPDATE
Given the following, which month should advertising costs be expensed by a company using
accrual based accounting: The furniture company paid $3,000 for advertising that ran in the local
newspaper in November 2011? - CORRECT ANSWER November 2011
What will be the total impact of services provided on the balance sheet other than an increase in
cash of $4,000 given the following:
Services were provided worth $10,000; customers paid $4,000 up front and promised the balance
next month? - CORRECT ANSWER Accounts receivable will increase $6,000 & Retained
earnings will increase $10,000
What was the 2012 net profit amount if the 2013 pro-forma net profit of $187,000 was based on
a 22% increase? - CORRECT ANSWER $153,279
What does accounting focus on? - CORRECT ANSWER 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? - CORRECT ANSWER Statement of cash flows
Which users would have a primary concern with an organization's ability to provide healthcare
benefits? - CORRECT ANSWER Employees
Which benefit does a corporation gain by following Generally Accepted Accounting Principles
(GAAP) - CORRECT ANSWER An increase in its comparability to other companies
Which of the following is the most correct definition of accounting? - CORRECT ANSWER A
system for providing quantitative information, primarily financial in nature, about economic
entities that is intended to be useful in making economic decisions
What is NOT typically true of accounting information? - CORRECT ANSWER The
information relates to future time periods.
