WGU C213 Pre Assessment 2023

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What does accounting focus on? Ans- The impact a business's activities have on its overall financial performance Which report summarizes cash collections and cash expenditures from operating, inves... ting, and financing activities over a period of time? Ans- Statement of cash flows Which users would have a primary concern with an organization's ability to provide healthcare benefits? Ans- Employees Which body regulates a certified public accounting firm's audit practices when the firm is auditing a large publicly traded company? Ans- The Public Company Accounting Oversight Board (PCAOB) What has had the most significant impact on accounting practices? Ans- Information technology What two items of information are revealed on the balance sheet? Choose 2 answers Ans- Ownership. Debt Which term is defined as the residual interest in the net assets of a company? Ans- 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? Ans- $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? Ans- In 2014, a company provides services to a customer for which cash will be collected the next year (2015). Which category on the statement of cash flows summarizes cash receipts and payments to owners and creditors of the company? Ans- Cash flows from financing activities Where would an investor find a summary of a company's significant accounting policies? Ans- In the notes to financial statements Which assurance does an external audit report provide for its readers? Ans- The company's financial statements fairly reflect its financial position Reliable Ans- Information that can be verified Relevant Ans- Information having to do with the matter at hand Material Ans- Information that is important enough to make a difference Conservatism Ans- Information related to recognizing losses as they occur What are steps in the decision cycle? Ans- 1 Prepare financial statements. 2 Analyze financial statements. 3 Gather information. 4 Make decision. 5 Implement decision. Partial financial information for a company is as follows: Current assets $36,543 Total assets $58,719 Current liabilities $24,824 Total liabilities $48,561 Stockholders' equity $10,158 Sales $46,997 Net Income $ 3,761 Market value of shares $41,316 What is the price-earnings (PE) ratio for this company? Ans- 11.0 What is consistent with a continual decline in gross profit if the firm's cost of goods sold remains the same? Ans- Continual decrease in sales Which two cash flow adequacy ratios represent a cash cow? Ans- $6,991/$5,486. $5,220/$1,875. Which formula yields a cash times interest earned ratio of 11? Ans- Cash before interest and taxes of $11,000 / cash paid for interest of $1,000 Which form of debt should be reported in the long-term liability category? Ans- Notes payable expected to be paid in 18 months In January of year 1, a company began doing business as a corporation in order to sell technologyrelated accessories and services. During its first month of operations, the following events occurred: January 1 The corporation received $1,000,000 in cash in exchange for stock issued to stockholders. January 3 The corporation borrowed $250,000 from bank. The loan is a four-year loan with an interest rate of 12 percent, payable each year on January 1 beginning in year 2. January 5 The corporation purchased equipment to be used in the business for $200,000 cash. January 8 The corporation purchased inventory costing $200,000 by paying $120,000 in cash. The remainder was put on credit accounts with suppliers. January 15 The corporation hired five employees. Each employee will be paid $1,000 at the end of each month. January 30 The corporation paid $6,000 cash for a one-year insurance policy. The policy period will begin on February 1, year 1. What will be the impact of the January 5 event on the company's balance sheet on that date? AnsEquipment will increase $200,000, and cash will decrease $200,000. In January of year 1, a company began doing business as a corporation in order to sell technologyrelated accessories and services. During its first month of operations, the following events occurred: January 1 The corporation received $1,000,000 in cash in exchange for stock issued to stockholders. January 3 The corporation borrowed $250,000 from a bank. The loan is a four-year loan with an interest rate of 12 percent, payable each year on January 1 beginning in year 2. January 5 The corporation purchased equipment to be used in the business for $200,000 cash. January 8 The corporation purchased inventory costing $200,000 by paying $120,000 in cash. The remainder was put on credit accounts with supplier [Show More]

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