WGU D103 OA2 FORMULAS EXAM QUESTIONS WITH VERIFIED
ANSWERS
100% Correct 40
Incorrect 0
1 of 40
Term
What is the effect of understating beginning inventory on COGS and
Net Income?
Give this one a go later!
COGS is understated (U), Net Income COGS is understated (U), Net
is understated (U); Inverse Income is overstated (O); Direct
relationship to GP/NI. relationship to COGS.
COGS is overstated (O), Net Income COGS is overstated (O), Net Income
is overstated (O); Direct relationship is understated (U); Inverse
to GP. relationship to COGS
Don't know?
, 2 of 40
Term
inventory turnover formula
Give this one a go later!
gross profit/average inventory cost of goods sold/ending inventory
cost of goods sold/average cost of goods sold/average
gross inventory inventory
Don't know?
3 of 40
Term
Formula for current ratio
Give this one a go later!
Current Assets / Current
Current Assets / Total Assets
Liabilities
Cash / current liabilities Total Assets / Total Liabilities
, Don't know?
4 of 40
Term
When COGS is understated, what is net income?
Give this one a go later!
Expenses are overstated Net Income is Understated
Gross Profit is overstated Net income is overstated
Don't know?
5 of 40
Definition
an annuity for which the cash flows occur at the beginning of the
period
Give this one a go later!
Ordinary perpetuity Perpetuity due
ANSWERS
100% Correct 40
Incorrect 0
1 of 40
Term
What is the effect of understating beginning inventory on COGS and
Net Income?
Give this one a go later!
COGS is understated (U), Net Income COGS is understated (U), Net
is understated (U); Inverse Income is overstated (O); Direct
relationship to GP/NI. relationship to COGS.
COGS is overstated (O), Net Income COGS is overstated (O), Net Income
is overstated (O); Direct relationship is understated (U); Inverse
to GP. relationship to COGS
Don't know?
, 2 of 40
Term
inventory turnover formula
Give this one a go later!
gross profit/average inventory cost of goods sold/ending inventory
cost of goods sold/average cost of goods sold/average
gross inventory inventory
Don't know?
3 of 40
Term
Formula for current ratio
Give this one a go later!
Current Assets / Current
Current Assets / Total Assets
Liabilities
Cash / current liabilities Total Assets / Total Liabilities
, Don't know?
4 of 40
Term
When COGS is understated, what is net income?
Give this one a go later!
Expenses are overstated Net Income is Understated
Gross Profit is overstated Net income is overstated
Don't know?
5 of 40
Definition
an annuity for which the cash flows occur at the beginning of the
period
Give this one a go later!
Ordinary perpetuity Perpetuity due
