WGU D775
EXAM QUESTIONS AND VERIFIED
CORRECT ANSWERS GRADED A+
LATEST 2026-2027
What is the ethical guidance principle? - CORRECT ANSWER-Honesty, fairness, accountability
Why do ratios help assess risk? - CORRECT ANSWER-Identify economic hazards
Why do investors use ratios? - CORRECT ANSWER-Assess potential ROI
What is the purpose of ratios in investment? - CORRECT ANSWER-Evaluate profitability &
growth
What do market ratios measure? - CORRECT ANSWER-Stock performance
Why do companies use market ratios? - CORRECT ANSWER-Analyze stock value
What does a low quick ratio indicate? - CORRECT ANSWER-Reliance on inventory
What does a high cash ratio show? - CORRECT ANSWER-Immediate debt coverage
What does the TIE ratio focus on? - CORRECT ANSWER-Earnings covering debt payments
, What ratio is used for cost-cutting evaluation? - CORRECT ANSWER-Profit margin
What does a high profit margin indicate? - CORRECT ANSWER-Effective cost control
What causes a low average collection period? - CORRECT ANSWER-Efficient credit policies
Why is the quick ratio preferred? - CORRECT ANSWER-More stringent liquidity test
How does new efficient equipment affect fixed asset turnover? - CORRECT ANSWER-Increases
fixed asset turnover
What does retiring loans improve? - CORRECT ANSWER-Debt-to-assets ratio
What is the response to low asset turnover? - CORRECT ANSWER-Invest in efficiency
What does lower margins in a region indicate? - CORRECT ANSWER-Higher food costs
What ratio is used for credit-policy compliance? - CORRECT ANSWER-Average collection period
What does expanded equipment capacity increase? - CORRECT ANSWER-Fixed asset turnover
What is analyzed in equipment investment analysis? - CORRECT ANSWER-Fixed asset turnover
What leverage ratio do lenders review? - CORRECT ANSWER-Debt-to-equity
EXAM QUESTIONS AND VERIFIED
CORRECT ANSWERS GRADED A+
LATEST 2026-2027
What is the ethical guidance principle? - CORRECT ANSWER-Honesty, fairness, accountability
Why do ratios help assess risk? - CORRECT ANSWER-Identify economic hazards
Why do investors use ratios? - CORRECT ANSWER-Assess potential ROI
What is the purpose of ratios in investment? - CORRECT ANSWER-Evaluate profitability &
growth
What do market ratios measure? - CORRECT ANSWER-Stock performance
Why do companies use market ratios? - CORRECT ANSWER-Analyze stock value
What does a low quick ratio indicate? - CORRECT ANSWER-Reliance on inventory
What does a high cash ratio show? - CORRECT ANSWER-Immediate debt coverage
What does the TIE ratio focus on? - CORRECT ANSWER-Earnings covering debt payments
, What ratio is used for cost-cutting evaluation? - CORRECT ANSWER-Profit margin
What does a high profit margin indicate? - CORRECT ANSWER-Effective cost control
What causes a low average collection period? - CORRECT ANSWER-Efficient credit policies
Why is the quick ratio preferred? - CORRECT ANSWER-More stringent liquidity test
How does new efficient equipment affect fixed asset turnover? - CORRECT ANSWER-Increases
fixed asset turnover
What does retiring loans improve? - CORRECT ANSWER-Debt-to-assets ratio
What is the response to low asset turnover? - CORRECT ANSWER-Invest in efficiency
What does lower margins in a region indicate? - CORRECT ANSWER-Higher food costs
What ratio is used for credit-policy compliance? - CORRECT ANSWER-Average collection period
What does expanded equipment capacity increase? - CORRECT ANSWER-Fixed asset turnover
What is analyzed in equipment investment analysis? - CORRECT ANSWER-Fixed asset turnover
What leverage ratio do lenders review? - CORRECT ANSWER-Debt-to-equity
