WGU D196 Objective Assessment Prep (Latest 2024/
2025 Update) Principles of Financial and Managerial
Accounting- Questions and Verified Answers| 100%
Correct| Grade A
What is the accounting equation? - ANSWERAssets = Liability + Owners' Equity
Please explain the 3 parts of the accounting equation - ANSWERAssets = Cash,
Accounts Receivable (AR), trademarks/patents, investments
Liabilities = claims by debtors, Accounts Payable (AP)
Equity = claims by the owner
Debit is always on the _________ and Credit is always on the _________. -
ANSWERDebit is on the LEFT and credit is on the RIGHT.
Who is the "father of accounting" and in what year did he publish his book? -
ANSWERLuca Pacioli
Summa de arithmetica - 1494
Why do we need accounting? - ANSWERTo discover financial inconsistencies, fraud
Analyze and predict budgets
Compare different companies' financial reporting and performance
Define "accounting" - ANSWERA way of recording, analyzing and summarizing
transactions of a business.
What is the "language" of accounting? - ANSWERDouble entry bookkeeping
What is the idea of double entry? - ANSWERThe idea is that each entry is written
down twice - Debit and Credit
What are the three main steps of accounting? - ANSWER1. Recording the
information
2. Ledgers
3. Financial statements
Cost and management accounting is concerned with providing management
information concerning what? - ANSWER1. Planning
2. Control
3. Making decisions
What are some of the roles of Managerial Accounting? - ANSWERCost accounting
Budgeting
, Making management decisions
Evaluating performance
Budgeting for capital costs and making decisions
Price formation
What are some of the roles of Managing Finance? - ANSWERPlanning and managing
cash flows, including currency flows
Long-term financing decisions
Managing financial risks
Financing for investments
Managing working capital
What are some of aspects of preparing financial statements? - ANSWERFinancial
reports
Tax reports and calculations
Providing other info. for external users
Who are the users of information of FA? - ANSWERShareholders, investors, banks,
suppliers, credit institutions, tax collectors, company employees and other
EXTERNAL users
Who are the user of information of MA? - ANSWERManagement of different levels
WITHIN the company - president, shop foreman, etc.
What regulation(s) must be followed in FA? - ANSWERAccounting is strictly regulated
by external standard such as IFRS.
What regulation(s) must be followed in MA? - ANSWERThe managers themselves
decide the accounting methods.
What degree of accuracy in required in FA? - ANSWERThe data must be fair and
accurate.
What degree of accuracy in required in MA? - ANSWERApproximate values are
acceptable as long as they are sufficient for management decisions.
What is the scope of accounting in FA? - ANSWERActivities of the ENTIRE
organization
What is the scope of accounting in MA? - ANSWERWhatever the manager decides -
separate segments, areas of production, subdivisions, market areas
What are the measures of accounting information in FA? - ANSWERCost and
monetary
What are the measures of accounting information in MA? - ANSWERCost, in kind,
labor
2025 Update) Principles of Financial and Managerial
Accounting- Questions and Verified Answers| 100%
Correct| Grade A
What is the accounting equation? - ANSWERAssets = Liability + Owners' Equity
Please explain the 3 parts of the accounting equation - ANSWERAssets = Cash,
Accounts Receivable (AR), trademarks/patents, investments
Liabilities = claims by debtors, Accounts Payable (AP)
Equity = claims by the owner
Debit is always on the _________ and Credit is always on the _________. -
ANSWERDebit is on the LEFT and credit is on the RIGHT.
Who is the "father of accounting" and in what year did he publish his book? -
ANSWERLuca Pacioli
Summa de arithmetica - 1494
Why do we need accounting? - ANSWERTo discover financial inconsistencies, fraud
Analyze and predict budgets
Compare different companies' financial reporting and performance
Define "accounting" - ANSWERA way of recording, analyzing and summarizing
transactions of a business.
What is the "language" of accounting? - ANSWERDouble entry bookkeeping
What is the idea of double entry? - ANSWERThe idea is that each entry is written
down twice - Debit and Credit
What are the three main steps of accounting? - ANSWER1. Recording the
information
2. Ledgers
3. Financial statements
Cost and management accounting is concerned with providing management
information concerning what? - ANSWER1. Planning
2. Control
3. Making decisions
What are some of the roles of Managerial Accounting? - ANSWERCost accounting
Budgeting
, Making management decisions
Evaluating performance
Budgeting for capital costs and making decisions
Price formation
What are some of the roles of Managing Finance? - ANSWERPlanning and managing
cash flows, including currency flows
Long-term financing decisions
Managing financial risks
Financing for investments
Managing working capital
What are some of aspects of preparing financial statements? - ANSWERFinancial
reports
Tax reports and calculations
Providing other info. for external users
Who are the users of information of FA? - ANSWERShareholders, investors, banks,
suppliers, credit institutions, tax collectors, company employees and other
EXTERNAL users
Who are the user of information of MA? - ANSWERManagement of different levels
WITHIN the company - president, shop foreman, etc.
What regulation(s) must be followed in FA? - ANSWERAccounting is strictly regulated
by external standard such as IFRS.
What regulation(s) must be followed in MA? - ANSWERThe managers themselves
decide the accounting methods.
What degree of accuracy in required in FA? - ANSWERThe data must be fair and
accurate.
What degree of accuracy in required in MA? - ANSWERApproximate values are
acceptable as long as they are sufficient for management decisions.
What is the scope of accounting in FA? - ANSWERActivities of the ENTIRE
organization
What is the scope of accounting in MA? - ANSWERWhatever the manager decides -
separate segments, areas of production, subdivisions, market areas
What are the measures of accounting information in FA? - ANSWERCost and
monetary
What are the measures of accounting information in MA? - ANSWERCost, in kind,
labor
