WGU D196 TEST BANK FOR OA AND
PREASSESSMENT REVIEW 2024/2025 WITH 250
ACTUAL EXAM QUESTIONS AND CORRECT
ANSWERS (100% CORRECT ANSWERS) D196
PRACTICE EXAM 2024 (BRAND NEW!!)
What is the correct sequence of budgets in a manufacturing business? - ANSWER
Sales, production, direct materials
What is the effect of a company's accounting department maintaining high ethical
standards? - ANSWER The company's accounting information will increase in value.
Why might employees be interested in their company's financial accounting
information? - ANSWER Financial statement data are often used in determining
employee bonuses.
Which group establishes financial accounting rules in the United States? - ANSWER
Financial Accounting Standards Board (FASB)
Which report is one of the three primary financial statements? - ANSWER
Statement of cash flows
A company paid $5,000 cash in advertising costs.
How does this transaction affect the paying company's accounting equation? -
ANSWER Assets increase by $5,000; expenses increase by $5,000.
A company borrowed $80,000 cash from a bank. - ANSWER Assets increase by
$80,000; liabilities increase by $80,000.
What is the impact of expenses on the accounting equation? - ANSWER Expenses
decrease owners' equity.
Which type of account are accounts payable and notes payable both examples of? -
ANSWER Liability
What is the purpose of the financial accounting cycle? - ANSWER To gather
information related to the expenses and income generated by a company
According to the accounting equation, the amount of liabilities and equity must
always be equal to another amount.
What is that other amount? - ANSWER Assets
Which item is an expense item? - ANSWER Cost of goods sold
How is gross profit computed? - ANSWER Sales minus cost of goods sold
, Which type of account is retained earnings? - ANSWER Equity
For purposes of cash flow classification in the statement of cash flows, which item is
an operating activity? - ANSWER Paying Employees
How does a classified balance sheet provide useful information to a decision maker?
- ANSWER It distinguishes between current and long-term assets
What information does a balance sheet provide to a decision maker? - ANSWER
Summary of the financial position of a company at a particular date
What is an account payable? - ANSWER The amount owed by a company that
purchased goods or services from a supplier on credit
Why is the net cash for December negative while total sales for December are the
highest out of the months from October through December? - ANSWER Total cash
available does not reflect December sales because there was a high volume of credit
sales.
Managerial Accounting - ANSWER focuses on the information needed for planning,
implementing plans, and controlling costs. For Internal decisions
Financial Accounting - ANSWER concerned with reporting financial information to
external parties, such as stockholders, creditors, and regulators
What is looked at in Managerial Accounting? - ANSWER ~Product Costs
~Breakeven Analysis
~Budgeting
~Performance Evaluation
~Outsource Production
What is looked at in Financial Accounting? - ANSWER ~Credit Analysis
~Regulatory Uses
~Estimate the Value of the Company
Balance Sheet - ANSWER ~ List as of a point in time
~ Resources/ Assets
~ Obligations / Liabilities
Income Statement - ANSWER ~ For a period of time (such as a year)
~ How much profit did we make?
Statement Cash Flows - ANSWER ~ For a period of time (such as a year)
~ Where did our cash come from? Where did it go?
The balance sheet - ANSWER Reports the resources of a company (the assets),
the company's obligations (the liabilities), and the owners' equity, which represents
the difference between what is owned (assets) and what is owed (liabilities).
PREASSESSMENT REVIEW 2024/2025 WITH 250
ACTUAL EXAM QUESTIONS AND CORRECT
ANSWERS (100% CORRECT ANSWERS) D196
PRACTICE EXAM 2024 (BRAND NEW!!)
What is the correct sequence of budgets in a manufacturing business? - ANSWER
Sales, production, direct materials
What is the effect of a company's accounting department maintaining high ethical
standards? - ANSWER The company's accounting information will increase in value.
Why might employees be interested in their company's financial accounting
information? - ANSWER Financial statement data are often used in determining
employee bonuses.
Which group establishes financial accounting rules in the United States? - ANSWER
Financial Accounting Standards Board (FASB)
Which report is one of the three primary financial statements? - ANSWER
Statement of cash flows
A company paid $5,000 cash in advertising costs.
How does this transaction affect the paying company's accounting equation? -
ANSWER Assets increase by $5,000; expenses increase by $5,000.
A company borrowed $80,000 cash from a bank. - ANSWER Assets increase by
$80,000; liabilities increase by $80,000.
What is the impact of expenses on the accounting equation? - ANSWER Expenses
decrease owners' equity.
Which type of account are accounts payable and notes payable both examples of? -
ANSWER Liability
What is the purpose of the financial accounting cycle? - ANSWER To gather
information related to the expenses and income generated by a company
According to the accounting equation, the amount of liabilities and equity must
always be equal to another amount.
What is that other amount? - ANSWER Assets
Which item is an expense item? - ANSWER Cost of goods sold
How is gross profit computed? - ANSWER Sales minus cost of goods sold
, Which type of account is retained earnings? - ANSWER Equity
For purposes of cash flow classification in the statement of cash flows, which item is
an operating activity? - ANSWER Paying Employees
How does a classified balance sheet provide useful information to a decision maker?
- ANSWER It distinguishes between current and long-term assets
What information does a balance sheet provide to a decision maker? - ANSWER
Summary of the financial position of a company at a particular date
What is an account payable? - ANSWER The amount owed by a company that
purchased goods or services from a supplier on credit
Why is the net cash for December negative while total sales for December are the
highest out of the months from October through December? - ANSWER Total cash
available does not reflect December sales because there was a high volume of credit
sales.
Managerial Accounting - ANSWER focuses on the information needed for planning,
implementing plans, and controlling costs. For Internal decisions
Financial Accounting - ANSWER concerned with reporting financial information to
external parties, such as stockholders, creditors, and regulators
What is looked at in Managerial Accounting? - ANSWER ~Product Costs
~Breakeven Analysis
~Budgeting
~Performance Evaluation
~Outsource Production
What is looked at in Financial Accounting? - ANSWER ~Credit Analysis
~Regulatory Uses
~Estimate the Value of the Company
Balance Sheet - ANSWER ~ List as of a point in time
~ Resources/ Assets
~ Obligations / Liabilities
Income Statement - ANSWER ~ For a period of time (such as a year)
~ How much profit did we make?
Statement Cash Flows - ANSWER ~ For a period of time (such as a year)
~ Where did our cash come from? Where did it go?
The balance sheet - ANSWER Reports the resources of a company (the assets),
the company's obligations (the liabilities), and the owners' equity, which represents
the difference between what is owned (assets) and what is owed (liabilities).
