D102 Financial Accounting WGU Test Questions with
Answers Graded A+
What information is contained in a balance
sheet? - ANSWER -Report of a What cash flow category contains activities
company's financial position as of a point in whereby cash is obtained from or repaid to
time. owners or creditors? - ANSWER -
Financing
What is an owners' equity item?
Here are some financial statement items for
Accounts receivable the year for a company.
Loans payable Cash received from customers
Capital stock Cash received from the sale of land
Cash - ANSWER -Capital Stock Cash paid for dividends
Cash paid to employees for wages
Cash paid to purchase a new building
A company ended July with assets of Cash paid for rent
$150,000 and owner's equity of $60,000. Cash received as new investment from
What is the amount of liabilities at the end of owners
July? - ANSWER -$90,000 Which set of items is a list of items that are
used in computing the company's financing
cash flow for the year? - ANSWER -Cash
What is reported in a multiple-step income paid for dividends and cash received as new
statement that is not reported in a single- investment from owners.
step income statement? - ANSWER -
Gross Profit
Here are some financial statement items for a
company.
How is gross profit computed? - Net income
ANSWER -Sales minus cost of goods Cash flow from financing activities
sold. Cash balance at the beginning of the year
Sales Cash flow from investing activities
Accounts receivable
The following are some accounts from a Retained earnings at the beginning of the year
company's financial statements: Cash flow from operating activities
(accounts receivable, cost of goods sold, What items are used in computing the
cash, retained earnings, sales, inventory, company's ending cash balance for the year?
income tax expense, accounts payable) - ANSWER -Cash balance at the
Which set is a list of all of the items that are beginning of the year, cash flow from
used in computing this company's net operating activities, cash flow from investing
income? - ANSWER -Sales, cost of activities, and cash flow from financing
goods sold, and income tax expense. activities.
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, D102 Financial Accounting WGU Test Questions with
Answers Graded A+
How is revenue typically recorded with debits Debit to rent expense for $1,500.
and credits? - ANSWER -As a credit,
representing an increase in equity.
The revenue recognition principle states that
revenues are recorded when two main criteria
What is the proper way to record an increase have been met. One of those criteria is that
in an asset account and an increase in an cash has been collected or collectability is
equity account? - ANSWER -Asset, reasonably assured.
debit; equity, credit What is the other criterion? - ANSWER -
The earnings process is substantially
complete.
How are expenses typically recorded with
debits and credits? - ANSWER -As a
debit, representing an increase in assets. What is the matching principle? -
ANSWER -Expenses are recorded in the
same period in which the corresponding
A company purchased inventory for $5,000. revenue is recorded.
The company paid $1,000 cash and the
remainder of the purchase was made on
account. For large, publicly traded companies, why is
What is included in the journal entry accrual basis accounting preferred over cash
necessary to record this inventory purchase? basis accounting? - ANSWER -Accrual
- ANSWER -Credit to accounts payable basis accounting provides a more accurate
for $4,000. picture of a company's economic
profitability.
A company sold inventory that cost $1,300
for $2,000. It received $500 cash and the At the end of the year, before any closing
remainder was on account. entries are made, which account has a debit
What is included in the journal entry or balance? - ANSWER -Cost of Goods
entries necessary to record this sale of Sold
inventory? - ANSWER -Debit to
accounts receivable for $1,500.
What is a nominal account?
Capital stock
On August 1 of Year 1, a company paid Long-term debt
$7,200 for two years' rent. The rental period Salaries
starts on August 1 of Year 1. Equipment - ANSWER -Salaries
Which debit or credit is correctly included in
the adjusting journal entry necessary on
December 31 of Year 1? - ANSWER - In preparing a bank reconciliation, what is the
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Answers Graded A+
What information is contained in a balance
sheet? - ANSWER -Report of a What cash flow category contains activities
company's financial position as of a point in whereby cash is obtained from or repaid to
time. owners or creditors? - ANSWER -
Financing
What is an owners' equity item?
Here are some financial statement items for
Accounts receivable the year for a company.
Loans payable Cash received from customers
Capital stock Cash received from the sale of land
Cash - ANSWER -Capital Stock Cash paid for dividends
Cash paid to employees for wages
Cash paid to purchase a new building
A company ended July with assets of Cash paid for rent
$150,000 and owner's equity of $60,000. Cash received as new investment from
What is the amount of liabilities at the end of owners
July? - ANSWER -$90,000 Which set of items is a list of items that are
used in computing the company's financing
cash flow for the year? - ANSWER -Cash
What is reported in a multiple-step income paid for dividends and cash received as new
statement that is not reported in a single- investment from owners.
step income statement? - ANSWER -
Gross Profit
Here are some financial statement items for a
company.
How is gross profit computed? - Net income
ANSWER -Sales minus cost of goods Cash flow from financing activities
sold. Cash balance at the beginning of the year
Sales Cash flow from investing activities
Accounts receivable
The following are some accounts from a Retained earnings at the beginning of the year
company's financial statements: Cash flow from operating activities
(accounts receivable, cost of goods sold, What items are used in computing the
cash, retained earnings, sales, inventory, company's ending cash balance for the year?
income tax expense, accounts payable) - ANSWER -Cash balance at the
Which set is a list of all of the items that are beginning of the year, cash flow from
used in computing this company's net operating activities, cash flow from investing
income? - ANSWER -Sales, cost of activities, and cash flow from financing
goods sold, and income tax expense. activities.
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, D102 Financial Accounting WGU Test Questions with
Answers Graded A+
How is revenue typically recorded with debits Debit to rent expense for $1,500.
and credits? - ANSWER -As a credit,
representing an increase in equity.
The revenue recognition principle states that
revenues are recorded when two main criteria
What is the proper way to record an increase have been met. One of those criteria is that
in an asset account and an increase in an cash has been collected or collectability is
equity account? - ANSWER -Asset, reasonably assured.
debit; equity, credit What is the other criterion? - ANSWER -
The earnings process is substantially
complete.
How are expenses typically recorded with
debits and credits? - ANSWER -As a
debit, representing an increase in assets. What is the matching principle? -
ANSWER -Expenses are recorded in the
same period in which the corresponding
A company purchased inventory for $5,000. revenue is recorded.
The company paid $1,000 cash and the
remainder of the purchase was made on
account. For large, publicly traded companies, why is
What is included in the journal entry accrual basis accounting preferred over cash
necessary to record this inventory purchase? basis accounting? - ANSWER -Accrual
- ANSWER -Credit to accounts payable basis accounting provides a more accurate
for $4,000. picture of a company's economic
profitability.
A company sold inventory that cost $1,300
for $2,000. It received $500 cash and the At the end of the year, before any closing
remainder was on account. entries are made, which account has a debit
What is included in the journal entry or balance? - ANSWER -Cost of Goods
entries necessary to record this sale of Sold
inventory? - ANSWER -Debit to
accounts receivable for $1,500.
What is a nominal account?
Capital stock
On August 1 of Year 1, a company paid Long-term debt
$7,200 for two years' rent. The rental period Salaries
starts on August 1 of Year 1. Equipment - ANSWER -Salaries
Which debit or credit is correctly included in
the adjusting journal entry necessary on
December 31 of Year 1? - ANSWER - In preparing a bank reconciliation, what is the
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