WGU C213 PRE-ASSESSMENT V2
ACCOUNTING FOR DECISION MAKERS
(LATEST 2026/2027 UPDATE) 100%
VERIFIED QUESTIONS & ANSWERS
GRADE A
SECTION 1: ACCOUNTING FOUNDATIONS, GAAP &
CONCEPTS (QUESTIONS 1–15)
QUESTION 1
What does accounting focus on?
A. The impact a business's activities have on its relationships with customers
B. The impact a business's activities have on the environment
C. The impact a business's activities have on its overall financial performance
D. The impact a business's activities have on its public image
ANSWER: C
Rationale: Accounting focuses on identifying, measuring, and
communicating the financial effects of business activities. These
measurements help stakeholders evaluate profitability, liquidity, and
financial stability.
QUESTION 2
Which report summarizes cash collections and cash expenditures from
operating, investing, and financing activities over a period of time?
,A. Income statement
B. Balance sheet
C. Statement of cash flows
D. Statement of retained earnings
ANSWER: C
Rationale: The statement of cash flows explains how cash moves through a
business over a specific period. It separates cash activity into operating,
investing, and financing categories.
QUESTION 3
Which users would have a primary concern with an organization's ability to
provide healthcare benefits?
A. Suppliers
B. Employees
C. Vendors
D. Competitors
ANSWER: B
Rationale: Employees have a primary concern with an organization's ability
to provide healthcare benefits, as these benefits are part of their
compensation package and affect their overall well-being. Suppliers and
vendors are more concerned with the company's ability to pay for goods and
services.
QUESTION 4
Which body regulates a certified public accounting firm's audit practices when
the firm is auditing a large publicly traded company?
A. Financial Accounting Standards Board (FASB)
B. Securities and Exchange Commission (SEC)
,C. Public Company Accounting Oversight Board (PCAOB)
D. American Institute of CPAs (AICPA)
ANSWER: C
Rationale: The Public Company Accounting Oversight Board (PCAOB) is a
nonprofit corporation established by the Sarbanes-Oxley Act of 2002 to
oversee the audits of public companies. Its purpose is to protect investors
and the public interest.
QUESTION 5
What has had the most significant impact on accounting practices?
A. Government regulations
B. Information technology
C. Globalization
D. Tax laws
ANSWER: B
Rationale: Information technology has had the most significant impact on
accounting practices by automating processes, improving accuracy, enabling
real-time reporting, and facilitating data analysis.
QUESTION 6
What two items of information are revealed on the balance sheet? (Select two
answers.)
A. Ownership
B. Debt
C. Revenue
D. Expenses
ANSWER: A, B
, Rationale: The balance sheet reveals information about a company's
ownership (equity) and debt (liabilities). Ownership is represented by
stockholders' equity or owners' equity, while debt is represented by
liabilities. Revenue and expenses are reported on the income statement.
QUESTION 7
Which term is defined as the residual interest in the net assets of a company?
A. Assets
B. Liabilities
C. Revenue
D. Owners' equity
ANSWER: D
Rationale: Owners' equity represents the residual interest in the assets of an
entity after deducting liabilities. It reflects the owners' claim on company
resources and is calculated as Assets – Liabilities = Owners' Equity.
QUESTION 8
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?
A. $250 million
B. $350 million
C. $400 million
D. $450 million
ANSWER: B
Rationale: Using the accounting equation: Assets = Liabilities + Owners'
Equity. Total Assets = $300 million + $100 million = $400 million. Total
ACCOUNTING FOR DECISION MAKERS
(LATEST 2026/2027 UPDATE) 100%
VERIFIED QUESTIONS & ANSWERS
GRADE A
SECTION 1: ACCOUNTING FOUNDATIONS, GAAP &
CONCEPTS (QUESTIONS 1–15)
QUESTION 1
What does accounting focus on?
A. The impact a business's activities have on its relationships with customers
B. The impact a business's activities have on the environment
C. The impact a business's activities have on its overall financial performance
D. The impact a business's activities have on its public image
ANSWER: C
Rationale: Accounting focuses on identifying, measuring, and
communicating the financial effects of business activities. These
measurements help stakeholders evaluate profitability, liquidity, and
financial stability.
QUESTION 2
Which report summarizes cash collections and cash expenditures from
operating, investing, and financing activities over a period of time?
,A. Income statement
B. Balance sheet
C. Statement of cash flows
D. Statement of retained earnings
ANSWER: C
Rationale: The statement of cash flows explains how cash moves through a
business over a specific period. It separates cash activity into operating,
investing, and financing categories.
QUESTION 3
Which users would have a primary concern with an organization's ability to
provide healthcare benefits?
A. Suppliers
B. Employees
C. Vendors
D. Competitors
ANSWER: B
Rationale: Employees have a primary concern with an organization's ability
to provide healthcare benefits, as these benefits are part of their
compensation package and affect their overall well-being. Suppliers and
vendors are more concerned with the company's ability to pay for goods and
services.
QUESTION 4
Which body regulates a certified public accounting firm's audit practices when
the firm is auditing a large publicly traded company?
A. Financial Accounting Standards Board (FASB)
B. Securities and Exchange Commission (SEC)
,C. Public Company Accounting Oversight Board (PCAOB)
D. American Institute of CPAs (AICPA)
ANSWER: C
Rationale: The Public Company Accounting Oversight Board (PCAOB) is a
nonprofit corporation established by the Sarbanes-Oxley Act of 2002 to
oversee the audits of public companies. Its purpose is to protect investors
and the public interest.
QUESTION 5
What has had the most significant impact on accounting practices?
A. Government regulations
B. Information technology
C. Globalization
D. Tax laws
ANSWER: B
Rationale: Information technology has had the most significant impact on
accounting practices by automating processes, improving accuracy, enabling
real-time reporting, and facilitating data analysis.
QUESTION 6
What two items of information are revealed on the balance sheet? (Select two
answers.)
A. Ownership
B. Debt
C. Revenue
D. Expenses
ANSWER: A, B
, Rationale: The balance sheet reveals information about a company's
ownership (equity) and debt (liabilities). Ownership is represented by
stockholders' equity or owners' equity, while debt is represented by
liabilities. Revenue and expenses are reported on the income statement.
QUESTION 7
Which term is defined as the residual interest in the net assets of a company?
A. Assets
B. Liabilities
C. Revenue
D. Owners' equity
ANSWER: D
Rationale: Owners' equity represents the residual interest in the assets of an
entity after deducting liabilities. It reflects the owners' claim on company
resources and is calculated as Assets – Liabilities = Owners' Equity.
QUESTION 8
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?
A. $250 million
B. $350 million
C. $400 million
D. $450 million
ANSWER: B
Rationale: Using the accounting equation: Assets = Liabilities + Owners'
Equity. Total Assets = $300 million + $100 million = $400 million. Total
