WGU MBA Program C213 Accounting Exam Questions and Answers 100% Pass

WGU MBA Program C213 Accounting Exam Questions and Answers 100% Pass Accounting - Answer- Recording of day-to-day financial activities of a company and the organization of that information into summary reports used to evaluate the companies financial status. Three primary financial statements in financial accounting - Answer- 1) The Balance Sheet 2) The Income Statement 3) The Statement of Cash Flows Balance Sheet - Answer- A financial statement that reports assets, liabilities, and owner's equity on a specific date. Income Statement - Answer- A financial statement showing the revenue and expenses for a fiscal period. A company's expenses are subtracted from its revenues in computing net income. Statement of Cash Flows - Answer- the amount of cash collected and paid out by a company in the following three types of activities, operating, investing, and financing. Financial Accounting Users - Answer- Lenders, investors, company management, suppliers, customers, employees, competitors, government agencies, politicians and the press. FASB (Financial Accounting Standards Board) - Answer- A private body that sets the accounting standards in the United States. SEC Securities and Exchange Commission - Answer- Regulates US stock exchanges AICPA (American Institute of Certified Public Accountants) - Answer- Professional organization of certified public accountants in the US. Three factors that make right now a time of significant change in accounting are: - Answer- 1) Globalization of Accounting Standards 2) Information Technology 3) Accounting scandals including the 2001 Sarbanes-Oxley Act. Financial Statements - Answer- Increase the amount of financial information about a company to attract investors, lenders and other parties interested in the companies financial status. The Balance Sheet - Answer- A report that shows the company's financial position at a specified point in time and lists the company's resources (assets), obligations (liabilities), and net ownership interest (owner's equity). Notes to the Financial Statement - Answer- Provide information on the accounting assumptions used in preparing the statements and also provide supplemental information not included in the statements themselves. An audit performed by accountants from outside a company that increases the reliance that users can place on the information in the companies financial statements - Answer- External Audit Report Relevant - Answer- Information that is provided on a timely basis that can be used to assess the past and project the future. Reliable - Answer- Information that represents exactly what it is supposed to represent. Comparability - Answer- Ability to compare the accounting information of different companies because they use the same accounting principles. Conservatism - Answer- The practice of recognizing all losses but not recognizing gains until they are certain. Materiality - Answer- The concept that weighs whether or not a certain dollar amount is large enough to make a difference to anyone. current assets - Answer- cash and other assets expected to be exchanged for cash or consumed within a year What are the most common current assets? - Answer- cash, accounts receivable, inventory long term assets - Answer- assets that are expected to be used in business operations for longer than one year. What are the most common long term assets? - Answer- Property, plant and equipment intagible assets - Answer- companies report the intangibles that they have purchased from other companies but not the intangibles that they have developed themselves The first item in a U.S. balance sheet is - Answer- usually cash; companies located in non-U.S. countries often list long-term assets first. Companies usually provide balance sheets - Answer- For at least two years, with the statements shown in comparative, side-by-side format regognition - Answer- Recognition is the process of condensing all estimates and judgments into one number and reporting that one number in the formal financial statements What is the accounting equation? - Answer- Assets = Liabilities + Owner's Equity