WGU D102 Financial Accounting Study Guide | Questions &
Answers, Key Terms & Exam Prep
WGU D102
FINANCIAL ACCOUNTING
STUDY GUIDE • QUESTIONS & ANSWERS
2026/2027 Update
Course Code: WGU D102
Accounting Terms • Financial Statements • GAAP
Inventory • Depreciation • Internal Controls • Revenue Recognition
pg. 0
, account - ✓✓✓an accounting record in which the results of transactions are
accumulated; shows increases, decreases, and a balance
accounts receivable - ✓✓✓a current asset representing money due for services
performed or merchandise sold on credit
accrual accounting - ✓✓✓the process of recording expenses and revenues when
incurred and earned, regardless of when cash is received, and of adjusting
original transaction data into refined measures of a firm's past economic
performance and current economic condition
accrual basis accounting - ✓✓✓a system of accounting in which revenues and
expenses are recorded as they are earned and incurred, not necessarily when
cash is received or paid
accumulated depreciation - ✓✓✓reflects the wear and tear, or depreciation, of
items since they were originally purchased
additional paid-in capital - ✓✓✓capital invested by stockholders that exceeds the
par value of the issued shares
adjusting entries - ✓✓✓entries required at the end of each accounting period to
recognize, on an accrual basis, revenues and expenses for the period and to
report proper amounts for asset, liability, and owners' equity accounts
allowance method - ✓✓✓the recording of estimated losses due to uncollectible
accounts as expenses during the period in which the sales occurred
1
, allowance for bad debts - ✓✓✓a contra account, deducted from accounts
receivable, that shows the estimated losses from uncollectible accounts
amortization - ✓✓✓the process of cost allocation that assigns the original cost of
an intangible asset to the periods benefited
articulatoin - ✓✓✓the interrelationship among the financial statements
assets - ✓✓✓economic resources that are owned or controlled by a company
audit committee - ✓✓✓members of a company's board of directors who are
responsible for dealing with the external and internal auditors
average costing - ✓✓✓an inventory cost flow assumptions whereby cost of goods
sold and the cost of ending inventory are determined by using an average cost of
all merchandise available for sale during the period
bad debt expense - ✓✓✓an account that represents the portion of the current
period's credit sales that are estimated to be uncollectible
bad debts - ✓✓✓an uncollecible account receivable
balance sheet - ✓✓✓a listing of an organization's assets and of its liabilities at a
certain time
bank reconciliation - ✓✓✓the process of systematically comparing the cash
balance as reported by the bank with the cash balance on the company's books
and explaining any differences
2
Answers, Key Terms & Exam Prep
WGU D102
FINANCIAL ACCOUNTING
STUDY GUIDE • QUESTIONS & ANSWERS
2026/2027 Update
Course Code: WGU D102
Accounting Terms • Financial Statements • GAAP
Inventory • Depreciation • Internal Controls • Revenue Recognition
pg. 0
, account - ✓✓✓an accounting record in which the results of transactions are
accumulated; shows increases, decreases, and a balance
accounts receivable - ✓✓✓a current asset representing money due for services
performed or merchandise sold on credit
accrual accounting - ✓✓✓the process of recording expenses and revenues when
incurred and earned, regardless of when cash is received, and of adjusting
original transaction data into refined measures of a firm's past economic
performance and current economic condition
accrual basis accounting - ✓✓✓a system of accounting in which revenues and
expenses are recorded as they are earned and incurred, not necessarily when
cash is received or paid
accumulated depreciation - ✓✓✓reflects the wear and tear, or depreciation, of
items since they were originally purchased
additional paid-in capital - ✓✓✓capital invested by stockholders that exceeds the
par value of the issued shares
adjusting entries - ✓✓✓entries required at the end of each accounting period to
recognize, on an accrual basis, revenues and expenses for the period and to
report proper amounts for asset, liability, and owners' equity accounts
allowance method - ✓✓✓the recording of estimated losses due to uncollectible
accounts as expenses during the period in which the sales occurred
1
, allowance for bad debts - ✓✓✓a contra account, deducted from accounts
receivable, that shows the estimated losses from uncollectible accounts
amortization - ✓✓✓the process of cost allocation that assigns the original cost of
an intangible asset to the periods benefited
articulatoin - ✓✓✓the interrelationship among the financial statements
assets - ✓✓✓economic resources that are owned or controlled by a company
audit committee - ✓✓✓members of a company's board of directors who are
responsible for dealing with the external and internal auditors
average costing - ✓✓✓an inventory cost flow assumptions whereby cost of goods
sold and the cost of ending inventory are determined by using an average cost of
all merchandise available for sale during the period
bad debt expense - ✓✓✓an account that represents the portion of the current
period's credit sales that are estimated to be uncollectible
bad debts - ✓✓✓an uncollecible account receivable
balance sheet - ✓✓✓a listing of an organization's assets and of its liabilities at a
certain time
bank reconciliation - ✓✓✓the process of systematically comparing the cash
balance as reported by the bank with the cash balance on the company's books
and explaining any differences
2
