WGU C214 FINANCIAL MANAGEMENT OBJECTIVE
ASSESSMENT (OA) NEWEST 2025 ACTUAL EXAM
COMPLETE QUESTIONS AND WELL DEFINED
ANSWERS(VERIFIED ANSWERS)|ALREADY GRADED A+
If Accounts Receivable Increases, What Is The Impact On CFO?
.....Answer. CFO Will Decrease.
Are Actual Taxes Paid The Same As Shown On GAAP Income Statements?
.....Answer. No, Actual Taxes Follow IRS Rules. While Incomes Statements
Fallow GAAP Principles.
Which Decision Requires Using Subjective Estimates? .....Answer. Subjective
Estimates Are Used To Estimate The Economic Life Of A New Asset.
If There Is A 30% Chance Of A Recession, What Is The Probability Of Expansion?
.....Answer.....70%-- The Sum Of The Probabilities Must Equal 100%.
How Much Interest Is Paid On A 6% Bond Over 2 Years And 3 Months?
.....Answer.....6% X 1000=$60 Per Year. $60 X 2.25=$135 The Face Value Of Most US Bonds Is Set
To $1000.
,How Does A "Prudent Investor" Select Investments? .....Answer. They Will
Seek The Highest Return For The " Appropriate" Amount Of Risk.
What Do Points On The Efficient Frontier Measure? .....Answer. The
Maximum Return For A Given Level Of Risk; Maximum Return-To-Risk Ratio.
What Is A Beta? .....Answer. It Is A Measure Of A Stock's Risk Relative To The
Market.
Why Are Accurate Forecasts Important? .....Answer They Allow Us To:
Plan For Resources For Production. Accurate Evaluation Of Capital Projects.
Which Ratio Is Used In Valuing A Private Company? .....Answer. PE Ratio In
The "Comparable Multiples" Method.
What Are The 3 Cost Associated With Holding Inventory? .....Answer. 1)
Product
2) Storage
,3) Opportunity
What Risk Is Eliminated By A Diversified Portfolio? .....Answer. Idiosyncratic
Risk--Risk Affecting A Single Firm.
What Are The Impacts Of Outsourcing? .....Answer. 1) Fewer US Jobs
2) Lower Priced Products
What Are The Impacts Of Tariffs? .....Answer. 1) More US Jobs
2) Higher Product Cost For Customers
What Securities Are Exempt From Federal Income Taxation?
.....Answer. Municipal (Muni) Bond Interest Is Tax Exempt. (Treasury
Securities ARE Taxable).
Why Would A Firm Prefer To Issue Bonds Rather Than Stock? .....Answer. 1)
Debt Has Lower Required Return.
2) Debt Interest Is Tax Deductible
, What Is The Impact On APY As The Number Of Interest Payments Per Year Increase? .....Answer
APY Increases.
What Is The Present Value (PV) Of A Future Cash Flow Of A Stock Called?
.....Answer. Intrinsic Value
( It Is The "Real" Value Of A Stock; PV Of Cash To An Investor)
What Indicates If A Stock Is A "Good Investment" ? .....Answer. The Price Of
The Stock Is LESS Than The "Intrinsic Value".
In The Event Of Bankruptcy, What Is The Order Of A Claims Settlement?
.....Answer. 1) Creditors
2) Bonds
3) Subordinated Debt
4) Preferred Stock
5) Common Stock
What Is A Spontaneous Account? .....Answer. One That Changes With The
Level Of Sales--
Example: Current Assets & Liabilities.
ASSESSMENT (OA) NEWEST 2025 ACTUAL EXAM
COMPLETE QUESTIONS AND WELL DEFINED
ANSWERS(VERIFIED ANSWERS)|ALREADY GRADED A+
If Accounts Receivable Increases, What Is The Impact On CFO?
.....Answer. CFO Will Decrease.
Are Actual Taxes Paid The Same As Shown On GAAP Income Statements?
.....Answer. No, Actual Taxes Follow IRS Rules. While Incomes Statements
Fallow GAAP Principles.
Which Decision Requires Using Subjective Estimates? .....Answer. Subjective
Estimates Are Used To Estimate The Economic Life Of A New Asset.
If There Is A 30% Chance Of A Recession, What Is The Probability Of Expansion?
.....Answer.....70%-- The Sum Of The Probabilities Must Equal 100%.
How Much Interest Is Paid On A 6% Bond Over 2 Years And 3 Months?
.....Answer.....6% X 1000=$60 Per Year. $60 X 2.25=$135 The Face Value Of Most US Bonds Is Set
To $1000.
,How Does A "Prudent Investor" Select Investments? .....Answer. They Will
Seek The Highest Return For The " Appropriate" Amount Of Risk.
What Do Points On The Efficient Frontier Measure? .....Answer. The
Maximum Return For A Given Level Of Risk; Maximum Return-To-Risk Ratio.
What Is A Beta? .....Answer. It Is A Measure Of A Stock's Risk Relative To The
Market.
Why Are Accurate Forecasts Important? .....Answer They Allow Us To:
Plan For Resources For Production. Accurate Evaluation Of Capital Projects.
Which Ratio Is Used In Valuing A Private Company? .....Answer. PE Ratio In
The "Comparable Multiples" Method.
What Are The 3 Cost Associated With Holding Inventory? .....Answer. 1)
Product
2) Storage
,3) Opportunity
What Risk Is Eliminated By A Diversified Portfolio? .....Answer. Idiosyncratic
Risk--Risk Affecting A Single Firm.
What Are The Impacts Of Outsourcing? .....Answer. 1) Fewer US Jobs
2) Lower Priced Products
What Are The Impacts Of Tariffs? .....Answer. 1) More US Jobs
2) Higher Product Cost For Customers
What Securities Are Exempt From Federal Income Taxation?
.....Answer. Municipal (Muni) Bond Interest Is Tax Exempt. (Treasury
Securities ARE Taxable).
Why Would A Firm Prefer To Issue Bonds Rather Than Stock? .....Answer. 1)
Debt Has Lower Required Return.
2) Debt Interest Is Tax Deductible
, What Is The Impact On APY As The Number Of Interest Payments Per Year Increase? .....Answer
APY Increases.
What Is The Present Value (PV) Of A Future Cash Flow Of A Stock Called?
.....Answer. Intrinsic Value
( It Is The "Real" Value Of A Stock; PV Of Cash To An Investor)
What Indicates If A Stock Is A "Good Investment" ? .....Answer. The Price Of
The Stock Is LESS Than The "Intrinsic Value".
In The Event Of Bankruptcy, What Is The Order Of A Claims Settlement?
.....Answer. 1) Creditors
2) Bonds
3) Subordinated Debt
4) Preferred Stock
5) Common Stock
What Is A Spontaneous Account? .....Answer. One That Changes With The
Level Of Sales--
Example: Current Assets & Liabilities.
