WGU D774 Exam | Introduction to
Business Accounting Exam | Questions
and Verified Answers | Rated A+| Latest
2025/2026 Guide
When were the earliest forms of rudimentary bookkeeping developed? -
Correct Answer - About 5,000 years ago by the Mesopotamians,
Babylonians, and ancient Egyptians
What was one type of dealing that contributed to the Great Wall Street
Crash of 1929? - Correct Answer - Operating pump and dump plans
How can a company's financial statements be used to attract new
investors? - Correct Answer - By documenting past performance
Who are the primary users of management accounting information? -
Correct Answer - Internal users
Which time interval is covered by a balance sheet? - Correct Answer - A
snapshot prepared as of a specific date
Who are the primary users of managerial accounting information? -
Correct Answer - Decision makers inside a company
,Why might one company's management accounting system differ from
that of another company's? - Correct Answer - Competitive needs
How does the Securities and Exchange Commission (SEC) influence
accounting standard setting in the United States? - Correct Answer - It
establishes a complete set of accounting standards that compete with
the Financial Accounting Standards Board rules.
What is an initial public offering (IPO)? - Correct Answer - The first
issuance of ownership shares to the public
Who selects a corporation's chief executive officer (CEO)? - Correct
Answer - Board of directors
What are the two types of taxation corporations are subject to? - Correct
Answer - Income tax paid by the corporation and dividend income tax
paid by individual shareholders
How is gross profit computed? - Correct Answer - Sales minus cost of
goods sold
Which item is reported among a company's operating expenses? -
Correct Answer - Wages and salary expense
Which information is contained in gross margin? - Correct Answer - The
excess of the selling price of inventory over the purchase cost of
inventory
, What is the cost of buying products sold in a retail store called? - Correct
Answer - Cost of goods sold
Which number is referred to as the bottom line of the income statement?
- Correct Answer - Net income
How does net income impact the reported amount of a company's
owners' equity? - Correct Answer - Net income increases owners' equity.
What is the largest expense for any retail company? - Correct Answer -
Cost of goods sold
What is revenue? - Correct Answer - Amount a company earns from the
sale of goods and services
Which item should be reported as an expense in the income statement?
Disbursement for the monthly electricity bill, Receipts from customers,
Loan proceeds from a bank, Funds used to purchase a new building -
Correct Answer - Disbursement for the monthly electricity bill
What is an income statement? - Correct Answer - Report of the
revenues and expenses of a company during a period
Which summary information does a balance sheet provide to a decision-
maker? - Correct Answer - Financial position of a company at a
particular date
Business Accounting Exam | Questions
and Verified Answers | Rated A+| Latest
2025/2026 Guide
When were the earliest forms of rudimentary bookkeeping developed? -
Correct Answer - About 5,000 years ago by the Mesopotamians,
Babylonians, and ancient Egyptians
What was one type of dealing that contributed to the Great Wall Street
Crash of 1929? - Correct Answer - Operating pump and dump plans
How can a company's financial statements be used to attract new
investors? - Correct Answer - By documenting past performance
Who are the primary users of management accounting information? -
Correct Answer - Internal users
Which time interval is covered by a balance sheet? - Correct Answer - A
snapshot prepared as of a specific date
Who are the primary users of managerial accounting information? -
Correct Answer - Decision makers inside a company
,Why might one company's management accounting system differ from
that of another company's? - Correct Answer - Competitive needs
How does the Securities and Exchange Commission (SEC) influence
accounting standard setting in the United States? - Correct Answer - It
establishes a complete set of accounting standards that compete with
the Financial Accounting Standards Board rules.
What is an initial public offering (IPO)? - Correct Answer - The first
issuance of ownership shares to the public
Who selects a corporation's chief executive officer (CEO)? - Correct
Answer - Board of directors
What are the two types of taxation corporations are subject to? - Correct
Answer - Income tax paid by the corporation and dividend income tax
paid by individual shareholders
How is gross profit computed? - Correct Answer - Sales minus cost of
goods sold
Which item is reported among a company's operating expenses? -
Correct Answer - Wages and salary expense
Which information is contained in gross margin? - Correct Answer - The
excess of the selling price of inventory over the purchase cost of
inventory
, What is the cost of buying products sold in a retail store called? - Correct
Answer - Cost of goods sold
Which number is referred to as the bottom line of the income statement?
- Correct Answer - Net income
How does net income impact the reported amount of a company's
owners' equity? - Correct Answer - Net income increases owners' equity.
What is the largest expense for any retail company? - Correct Answer -
Cost of goods sold
What is revenue? - Correct Answer - Amount a company earns from the
sale of goods and services
Which item should be reported as an expense in the income statement?
Disbursement for the monthly electricity bill, Receipts from customers,
Loan proceeds from a bank, Funds used to purchase a new building -
Correct Answer - Disbursement for the monthly electricity bill
What is an income statement? - Correct Answer - Report of the
revenues and expenses of a company during a period
Which summary information does a balance sheet provide to a decision-
maker? - Correct Answer - Financial position of a company at a
particular date
