WGU C214 OA FINANCIAL MANAGEMENT
RETAKE EXAM LATEST QUESTIONS AND
ANSWERS (2026-2027) (VERIFIED
ANSWERS)
� Financial Management Practice Questions (1–50)
1. What is the primary purpose of the Foreign Corrupt Practices Act
(FCPA)?
A. To limit corporate taxes on foreign income
B. To prevent companies from bribing foreign officials for business
C. To regulate international trade tariffs
D. To protect domestic industries from competition
Correct Answer:B
Rationale: The FCPA makes it unlawful for U.S. companies and their agents to offer or
pay bribes to foreign officials to obtain or retain business. It also requires accurate
recordkeeping and internal controls to prevent corrupt payments.
2. What are two basic categories of financial instruments?
A. Deposits and withdrawals
B. Stocks and bonds
C. Cash and inventory
D. Receivables and payables
,Correct Answer:B
Rationale: Financial instruments are contracts that represent financial value. Stocks
represent equity ownership, while bonds represent debt owed by the issuer.
3. A secondary market is best described as:
A. A market where new securities are issued
B. A market where previously issued securities are traded
C. A market for commodities only
D. A market restricted to institutional investors
Correct Answer:B
Rationale: Secondary markets are where investors buy and sell securities that have
already been issued, such as on the NYSE or NASDAQ.
4. Cash flows from operating activities include:
A. Issuing new bonds
B. Cash paid for equipment
C. Cash received from customers
D. Purchasing treasury stock
Correct Answer:C
Rationale: Operating cash flows reflect day-to-day business activities, like cash
received from sales and cash paid to suppliers and employees.
5. Which statement does the statement of cash flows report?
, A. Changes in equity accounts
B. Cash receipts and cash payments over a period
C. Profit margin for the year
D. Depreciation schedules
Correct Answer:B
Rationale: The statement of cash flows shows how cash enters and leaves the
business through operations, investing, and financing.
6. Which equation links net income to the balance sheet?
A. Current Assets – Current Liabilities
B. Ending Retained Earnings = Beginning Retained Earnings + Net Income – Dividends
C. Total Liabilities = Total Assets + Equity
D. Gross Profit – Operating Expenses
Correct Answer:B
Rationale: Retained earnings reconcile income with equity, showing net income
retained in the business after dividends.
7. Cash flow from financing activities typically includes:
A. Sales revenue
B. Depreciation
C. Issuance of stock and dividends paid
D. Inventory purchases
Correct Answer:C
Rationale: Financing cash flows include cash raised by issuing debt or equity, and
cash paid out as dividends.
RETAKE EXAM LATEST QUESTIONS AND
ANSWERS (2026-2027) (VERIFIED
ANSWERS)
� Financial Management Practice Questions (1–50)
1. What is the primary purpose of the Foreign Corrupt Practices Act
(FCPA)?
A. To limit corporate taxes on foreign income
B. To prevent companies from bribing foreign officials for business
C. To regulate international trade tariffs
D. To protect domestic industries from competition
Correct Answer:B
Rationale: The FCPA makes it unlawful for U.S. companies and their agents to offer or
pay bribes to foreign officials to obtain or retain business. It also requires accurate
recordkeeping and internal controls to prevent corrupt payments.
2. What are two basic categories of financial instruments?
A. Deposits and withdrawals
B. Stocks and bonds
C. Cash and inventory
D. Receivables and payables
,Correct Answer:B
Rationale: Financial instruments are contracts that represent financial value. Stocks
represent equity ownership, while bonds represent debt owed by the issuer.
3. A secondary market is best described as:
A. A market where new securities are issued
B. A market where previously issued securities are traded
C. A market for commodities only
D. A market restricted to institutional investors
Correct Answer:B
Rationale: Secondary markets are where investors buy and sell securities that have
already been issued, such as on the NYSE or NASDAQ.
4. Cash flows from operating activities include:
A. Issuing new bonds
B. Cash paid for equipment
C. Cash received from customers
D. Purchasing treasury stock
Correct Answer:C
Rationale: Operating cash flows reflect day-to-day business activities, like cash
received from sales and cash paid to suppliers and employees.
5. Which statement does the statement of cash flows report?
, A. Changes in equity accounts
B. Cash receipts and cash payments over a period
C. Profit margin for the year
D. Depreciation schedules
Correct Answer:B
Rationale: The statement of cash flows shows how cash enters and leaves the
business through operations, investing, and financing.
6. Which equation links net income to the balance sheet?
A. Current Assets – Current Liabilities
B. Ending Retained Earnings = Beginning Retained Earnings + Net Income – Dividends
C. Total Liabilities = Total Assets + Equity
D. Gross Profit – Operating Expenses
Correct Answer:B
Rationale: Retained earnings reconcile income with equity, showing net income
retained in the business after dividends.
7. Cash flow from financing activities typically includes:
A. Sales revenue
B. Depreciation
C. Issuance of stock and dividends paid
D. Inventory purchases
Correct Answer:C
Rationale: Financing cash flows include cash raised by issuing debt or equity, and
cash paid out as dividends.
