WGU D196 Pre-Assessment, Top Exam Questions and answers, 100% Accurate, graded A+

Document Content and Description Below

WGU D196 Pre-Assessment, Top Exam Questions and answers, 100% Accurate, graded A+ What is the effect of a company's accounting department maintaining high ethical standards? -The company can rep... ort more favorable results in its financial statements. -The company's accounting information will decrease in value. -The company can hire fewer accountants to do the same amount of work. -The company's accounting information will increase in value. - ✔✔-The company's accounting information will increase in value. Why might employees be interested in their company's financial accounting information? -Financial statement data are used to record long term liabilities. -Financial statement data provide detailed internal budget information. -Financial statement data are often used in determining employee bonuses. -Financial statement data provide item-by-item product cost information. - ✔✔-Financial statement data are often used in determining employee bonuses. Which group establishes financial accounting rules in the United States? -Internal Revenue Service (IRS) -American Institute of Certified Public Accountants (AICPA) -Financial Accounting Standards Board (FASB) -International Accounting Standards Board (IASB) - ✔✔-Financial Accounting Standards Board (FASB) Which report is one of the three primary financial statements? -Statement of stakeholder funds -Statement of cash flows -Statement of the accounting cycle -Statement of management accounting - ✔✔-Statement of cash flows A company paid $5,000 cash in advertising costs. How does this transaction affect the paying company's accounting equation? -Assets decrease by $5,000; expenses increase by $5,000. -Assets decrease by $5,000; liabilities increase by $5,000. -Assets decrease by $5,000; revenues increase by $5,000. -Assets increase by $5,000; expenses increase by $5,000. - ✔✔-Assets decrease by $5,000; expenses increase by $5,000. What is a transaction? -Two parties exchanging something of value -An example of an online business document -A type of commonly used accounting software -A category of merchandiser or retailer - ✔✔-Two parties exchanging something of value A company borrowed $80,000 cash from a bank. How does this transaction affect the accounting equation of the borrowing company? -Expenses decrease owners' equity. -Expenses increase liabilities. -Expenses decrease liabilities. -Expenses increase owners' equity. - ✔✔-Expenses decrease owners' equity. What is the impact of expenses on the accounting equation? -Expenses decrease owners' equity. -Expenses increase liabilities. -Expenses decrease liabilities. -Expenses increase owners' equity. - ✔✔-Expenses decrease owners' equity. Which type of account are accounts payable and notes payable both examples of? -Asset -Equity -Expense -Liability - ✔✔-Liability What is the purpose of the financial accounting cycle? -To turn information about transactions into financial statements -To gather information related to the expenses and income generated by a company -To produce and analyze a company's monthly bank statement -To collect confidential information for management to use as a competitive tool - ✔✔-To turn information about transactions into financial statements According to the accounting equation, the amount of liabilities and equity must always be equal to another amount. What is that other amount? -Cash -The sum of expenses and dividends -Assets -The sum of revenues and expenses - ✔✔-Assets Which item is an expense item? -Accounts receivable -Accounts payable -Cost of goods sold -Loans payable - ✔✔-Cost of goods sold How is gross profit computed? -Sales minus cost of goods sold -Total revenues minus total expenses -Accounts receivable minus accounts payable -Total assets minus total liabilities - ✔✔-Sales minus cost of goods sold Which type of account is retained earnings? -Liability -Asset -Equity -Revenue - ✔✔-Equity For purposes of cash flow classification in the statement of cash flows, which item is an operating activity? -Buying equipment -Paying employees -Distributing dividends -Selling bonds - ✔✔-Paying employees How does a classified balance sheet provide useful information to a decision maker? -It provides data for a period of time instead of as a point in time. -It distinguishes between current and long-term assets. -It distinguishes liabilities from expenses. -It provides data that are not publicly disclosed. - ✔✔-It distinguishes between current and long-term assets. What information does a balance sheet provide to a decision maker? -Summary of the operating performance of a company at a particular date -Summary of the operating performance of a company during a period -Summary of the cash flows of a company during a period -Summary of the financial position of a company at a particular date - ✔✔-Summary of the financial position of a company at a particular date What is an account payable? -The amount to be paid by a company for dividends to shareholders -The amount owed by a company that purchased goods or services from a supplier on credit The amount to be paid by a company in repayment of both loans and dividends The amount owed to a company that sold goods or services to a customer on credit - ✔✔-The amount owed by a company that purchased goods or services from a supplier on credit What is an example of a financial cost that would result from poor direct labor budgeting and planning? -Delayed cash collections from credit customers -Increased hiring, training, and overtime costs -Excessive inventory storage costs -Increased depreciation costs for facilities - ✔✔-Increased hiring, training, and overtime costs What does a manager have control over in a cost center? -Dividends -Assets -Costs -Revenues - ✔✔-Costs What should be considered when developing a measure to evaluate the performance of a manager? -Only noncontrollable costs -Only controllable costs -Only centralized costs -Only indirect costs - ✔✔-Only controllable costs In some companies, the performance measures for profit center managers are heavily influenced by cost allocations downward from organizational units (such as company headquarters). Why is this a mistake? -Controllable costs should not be included in the performance evaluation measure of a profit center manager. -Revenues should not be included in the performance evaluation measure of a profit center manager. -Uncontrollable costs should not be included in the performance evaluation measure of a profit center manager. -Direct costs should not be included in the performance evaluation measure of a profit center manager. - ✔✔-Uncontrollable costs should not be included in the performance evaluation measure of a profit center manager. Which budget should include the expected cost of supplies used by the office staff of the corporate headquarters? -Production budget -Sales budget -Direct materials budget -Administrative expense budget - ✔✔-Administrative expense budget Which items are uncontrollable, external variables that make it difficult to forecast the level of sales? -Direct labor and advertising expenditures -Selling price and sales effort -Inventory level and product management -Customer tastes and economic conditions - ✔✔-Customer tastes and economic conditions What is the correct sequence of budgets in a manufacturing business? -Direct materials, sales, production -Production, direct materials, sales -Sales, direct materials, production -Sales, production, direct materials - ✔✔-Sales, production, direct materials Which type of business organization has a major focus on direct materials, direct labor, and overhead? -Retail -Merchandising -Service -Manufacturing - ✔✔-Manufacturin [Show More]

Last updated: 2 years ago

Preview 1 out of 14 pages