WGU D774 Introduction to Business Accounting Exam Questions And
Correct Verified Answers New Version 2026
Which ancient civilization dates to the early development of accounting? -ANSWER- Ancient Mesopotamia (c. 3000
BCE)
2 6
Which year is associated with the stock market crash that had a profound economic impact? -ANSWER- 1929
20
What was the regulatory outcome of accounting scandals such as Enron, WorldCom, and Tyco? -ANSWER- The Sarbanes-
Oxley Act was introduced, requiring stricter financial controls and oversight.
am
In which country was the double-entry accounting system developed in the 15th century? -ANSWER- Italy
Which major economic event followed soon after the Stock Market Crash of 1929? -ANSWER- Great Depression
Ex
Which economic event immediately preceded and led to the passage of the Sarbanes-Oxley Act of 2002? -ANSWER- Dot-
com bubble
s
rt
Which type of business has as its main economic activity using components or raw materials to make finished
goods for sale to customers? -ANSWER- A manufacturing business
pe
What are the three costs included in product costs? Direct materials, direct labor, and manufacturing overhead When it
comes to manufacturing companies, what are period costs? -ANSWER- Costs incurred by a manufacturing company that
Ex
are not directly related to the manufacturing process
Which type of company uses a raw materials inventory account? -ANSWER- Manufacturing company
When does inventory cost become part of cost of goods sold? -ANSWER- Once inventory is bought by a customer
An assembly line worker is painting one part of a product. Which type of cost refers to the amount of wages paid to an
assembly line worker? -ANSWER- Direct labor
,The company a manufacturer purchases raw materials from has increased its prices by 5%. Which type of cost will be
affected by this increase in price? -ANSWER- Prime costs
What is the role of the Securities and Exchange Commission (SEC) in influencing accounting standards? -ANSWER-
it enforces financial reporting rules established by the FASB
6
A financial professional wants to offer auditing and tax prep services to the public. To do so, they must pass a
2
certification exam and meet state licensing requirements. Which title does this individual need to obtain? -ANSWER-
20
CPA
a company is implementing new fraud prevention measures and ensuring compliance with financial reporting regulations.
Who is responsible for overseeing and maintaining these internal controls? -ANSWER- Management
am
Ex
s
rt
pe
Ex
, A business owner is trying to better understand their Financial accounting focuses on external reporting, while managerial accounting focuses
company's financial performance and operations. The owner on internal decision-making.
recently learned that two types of accounting-financial
3 multiple choice options
accounting and managerial accounting-serve
different purposes. What is one difference between
them?
2 6
Which statement describes the focus of managerial Improving future results based on an analysis of past performance
accounting?
3 multiple choice options
20
A company is preparing annual financial statements to share They include monetary and nonmonetary information.
with investors. Which characteristic of financial accounting
3 multiple choice options
reports applies in this situation?
A publicly traded company is preparing to issue stock to its
investors. As part of the process, the company must submit
financial disclosures and filings to the regulatory agency
overseeing securities markets. Which federal agency is
am Securities and Exchange Commission (SEC)
2 multiple choice options
responsible for this regulation?
Ex
Which organizationis an independent, nonprofit entity Financial Accounting Standards Board (FASB)
responsible for setting financial accounting and reporting 2 multiple choice options
standards for public and private sector businesses in the United
States that use generally accepted accounting principles (GAAP)?
ts
What is the purpose of the Public Company Accounting Oversight It oversees the audits of public companies to protect investors.
r
Board (PCAOB)?
2 multiple choice options
pe
A multinational corporation wants to hire an audit firm with
Big Four
extensive experience in financial statement auditing for publicly
traded companies. Which type of firm would be the most 3 multiple choice options
suitable choice?
Ex
Which accounting formula does the income statement Revenues-expenses
represent?
3 multiple choice options
What does a company's operating expense on the income The day-to-day operational costs not associated with the direct selling of
statement represent? products or services
2 multiple choice options
Correct Verified Answers New Version 2026
Which ancient civilization dates to the early development of accounting? -ANSWER- Ancient Mesopotamia (c. 3000
BCE)
2 6
Which year is associated with the stock market crash that had a profound economic impact? -ANSWER- 1929
20
What was the regulatory outcome of accounting scandals such as Enron, WorldCom, and Tyco? -ANSWER- The Sarbanes-
Oxley Act was introduced, requiring stricter financial controls and oversight.
am
In which country was the double-entry accounting system developed in the 15th century? -ANSWER- Italy
Which major economic event followed soon after the Stock Market Crash of 1929? -ANSWER- Great Depression
Ex
Which economic event immediately preceded and led to the passage of the Sarbanes-Oxley Act of 2002? -ANSWER- Dot-
com bubble
s
rt
Which type of business has as its main economic activity using components or raw materials to make finished
goods for sale to customers? -ANSWER- A manufacturing business
pe
What are the three costs included in product costs? Direct materials, direct labor, and manufacturing overhead When it
comes to manufacturing companies, what are period costs? -ANSWER- Costs incurred by a manufacturing company that
Ex
are not directly related to the manufacturing process
Which type of company uses a raw materials inventory account? -ANSWER- Manufacturing company
When does inventory cost become part of cost of goods sold? -ANSWER- Once inventory is bought by a customer
An assembly line worker is painting one part of a product. Which type of cost refers to the amount of wages paid to an
assembly line worker? -ANSWER- Direct labor
,The company a manufacturer purchases raw materials from has increased its prices by 5%. Which type of cost will be
affected by this increase in price? -ANSWER- Prime costs
What is the role of the Securities and Exchange Commission (SEC) in influencing accounting standards? -ANSWER-
it enforces financial reporting rules established by the FASB
6
A financial professional wants to offer auditing and tax prep services to the public. To do so, they must pass a
2
certification exam and meet state licensing requirements. Which title does this individual need to obtain? -ANSWER-
20
CPA
a company is implementing new fraud prevention measures and ensuring compliance with financial reporting regulations.
Who is responsible for overseeing and maintaining these internal controls? -ANSWER- Management
am
Ex
s
rt
pe
Ex
, A business owner is trying to better understand their Financial accounting focuses on external reporting, while managerial accounting focuses
company's financial performance and operations. The owner on internal decision-making.
recently learned that two types of accounting-financial
3 multiple choice options
accounting and managerial accounting-serve
different purposes. What is one difference between
them?
2 6
Which statement describes the focus of managerial Improving future results based on an analysis of past performance
accounting?
3 multiple choice options
20
A company is preparing annual financial statements to share They include monetary and nonmonetary information.
with investors. Which characteristic of financial accounting
3 multiple choice options
reports applies in this situation?
A publicly traded company is preparing to issue stock to its
investors. As part of the process, the company must submit
financial disclosures and filings to the regulatory agency
overseeing securities markets. Which federal agency is
am Securities and Exchange Commission (SEC)
2 multiple choice options
responsible for this regulation?
Ex
Which organizationis an independent, nonprofit entity Financial Accounting Standards Board (FASB)
responsible for setting financial accounting and reporting 2 multiple choice options
standards for public and private sector businesses in the United
States that use generally accepted accounting principles (GAAP)?
ts
What is the purpose of the Public Company Accounting Oversight It oversees the audits of public companies to protect investors.
r
Board (PCAOB)?
2 multiple choice options
pe
A multinational corporation wants to hire an audit firm with
Big Four
extensive experience in financial statement auditing for publicly
traded companies. Which type of firm would be the most 3 multiple choice options
suitable choice?
Ex
Which accounting formula does the income statement Revenues-expenses
represent?
3 multiple choice options
What does a company's operating expense on the income The day-to-day operational costs not associated with the direct selling of
statement represent? products or services
2 multiple choice options
