WGU D196 TEST BANK FOR OA AND PRE ASSESSMENT
(LATEST 2026 UPDATE) ACTUAL EXAM| QUESTIONS AND
CORRECT VERIFIED ANSWERS / D196 EXAM 2026
|GRADED A+
What is an account payable?
The amount to be paid by a company for dividends to shareholders
The amount to be paid by a company in repayment of both loans and
dividends
The amount owed to a company that sold goods or services to a
customer on credit
The amount owed by a company that purchased goods or services
from a supplier on credit
- Answer -The amount owed by a company that purchased goods or
services from a supplier on credit
What is an example of a financial cost that would result from poor
direct labor budgeting and planning?
Excessive inventory storage costs
Increased hiring, training, and overtime costs
Delayed cash collections from credit customers
Increased depreciation costs for facilities
- Answer -Increased hiring, training, and overtime costs
What does a manager have control over in a cost center?
Costs
Assets
Dividends
Revenues - Answer -Costs
pg. 1
,What should be considered when developing a measure to evaluate
the performance of a manager?
Only controllable costs
Only noncontrollable costs
Only indirect costs
Only centralized costs - Answer -Only controllable costs
In some companies, the performance measures for profit center
managers are heavily influenced by cost allocations downward from
organizational units (such as company headquarters).
Why is this a mistake?
Direct costs should not be included in the performance evaluation
measure of a profit center manager.
Controllable costs should not be included in the performance
evaluation measure of a profit center manager.
Uncontrollable costs should not be included in the performance
evaluation measure of a profit center manager.
Revenues should not be included in the performance evaluation
measure of a profit center manager.
- Answer -Uncontrollable costs should not be included in the
performance evaluation measure of a profit center manager.
Which budget should include the expected cost of supplies used by
the office staff of the corporate headquarters?
Production budget
Direct materials budget
Sales budget
Administrative expense budget
- Answer -Administrative expense budget
pg. 2
,Which items are uncontrollable, external variables that make it
difficult to forecast the level of sales?
Inventory level and product management
Selling price and sales effort
Customer tastes and economic conditions
Direct labor and advertising expenditures
- Answer -Customer tastes and economic conditions
What is the correct sequence of budgets in a manufacturing business?
Direct materials, sales, production
Sales, production, direct materials
Production, direct materials, sales
Sales, direct materials, production
- Answer -Sales, production, direct materials
What is the effect of a company's accounting department maintaining
high ethical standards?
The company can hire fewer accountants to do the same amount of
work.
The company's accounting information will decrease in value.
The company can report more favorable results in its financial
statements.
The company's accounting information will increase in value.
- Answer -The company's accounting information will increase in
value.
Why might employees be interested in their company's financial
accounting information?
Financial statement data are used to record long term liabilities.
pg. 3
, Financial statement data provide item-by-item product cost
information.
Financial statement data provide detailed internal budget information.
Financial statement data are often used in determining employee
bonuses.
- Answer -Financial statement data are often used in determining
employee bonuses.
Which group establishes financial accounting rules in the United
States?
American Institute of Certified Public Accountants (AICPA)
Financial Accounting Standards Board (FASB)
International Accounting Standards Board (IASB)
Internal Revenue Service (IRS)
- Answer -Financial Accounting Standards Board (FASB)
Which report is one of the three primary financial statements?
Statement of the accounting cycle
Statement of management accounting
Statement of cash flows
Statement of stakeholder funds
- Answer -Statement of cash flows
A company paid $5,000 cash in advertising costs.
How does this transaction affect the paying company's accounting
equation?
Assets decrease by $5,000; expenses increase by $5,000.
Assets increase by $5,000; expenses increase by $5,000.
Assets decrease by $5,000; revenues increase by $5,000.
pg. 4
(LATEST 2026 UPDATE) ACTUAL EXAM| QUESTIONS AND
CORRECT VERIFIED ANSWERS / D196 EXAM 2026
|GRADED A+
What is an account payable?
The amount to be paid by a company for dividends to shareholders
The amount to be paid by a company in repayment of both loans and
dividends
The amount owed to a company that sold goods or services to a
customer on credit
The amount owed by a company that purchased goods or services
from a supplier on credit
- Answer -The amount owed by a company that purchased goods or
services from a supplier on credit
What is an example of a financial cost that would result from poor
direct labor budgeting and planning?
Excessive inventory storage costs
Increased hiring, training, and overtime costs
Delayed cash collections from credit customers
Increased depreciation costs for facilities
- Answer -Increased hiring, training, and overtime costs
What does a manager have control over in a cost center?
Costs
Assets
Dividends
Revenues - Answer -Costs
pg. 1
,What should be considered when developing a measure to evaluate
the performance of a manager?
Only controllable costs
Only noncontrollable costs
Only indirect costs
Only centralized costs - Answer -Only controllable costs
In some companies, the performance measures for profit center
managers are heavily influenced by cost allocations downward from
organizational units (such as company headquarters).
Why is this a mistake?
Direct costs should not be included in the performance evaluation
measure of a profit center manager.
Controllable costs should not be included in the performance
evaluation measure of a profit center manager.
Uncontrollable costs should not be included in the performance
evaluation measure of a profit center manager.
Revenues should not be included in the performance evaluation
measure of a profit center manager.
- Answer -Uncontrollable costs should not be included in the
performance evaluation measure of a profit center manager.
Which budget should include the expected cost of supplies used by
the office staff of the corporate headquarters?
Production budget
Direct materials budget
Sales budget
Administrative expense budget
- Answer -Administrative expense budget
pg. 2
,Which items are uncontrollable, external variables that make it
difficult to forecast the level of sales?
Inventory level and product management
Selling price and sales effort
Customer tastes and economic conditions
Direct labor and advertising expenditures
- Answer -Customer tastes and economic conditions
What is the correct sequence of budgets in a manufacturing business?
Direct materials, sales, production
Sales, production, direct materials
Production, direct materials, sales
Sales, direct materials, production
- Answer -Sales, production, direct materials
What is the effect of a company's accounting department maintaining
high ethical standards?
The company can hire fewer accountants to do the same amount of
work.
The company's accounting information will decrease in value.
The company can report more favorable results in its financial
statements.
The company's accounting information will increase in value.
- Answer -The company's accounting information will increase in
value.
Why might employees be interested in their company's financial
accounting information?
Financial statement data are used to record long term liabilities.
pg. 3
, Financial statement data provide item-by-item product cost
information.
Financial statement data provide detailed internal budget information.
Financial statement data are often used in determining employee
bonuses.
- Answer -Financial statement data are often used in determining
employee bonuses.
Which group establishes financial accounting rules in the United
States?
American Institute of Certified Public Accountants (AICPA)
Financial Accounting Standards Board (FASB)
International Accounting Standards Board (IASB)
Internal Revenue Service (IRS)
- Answer -Financial Accounting Standards Board (FASB)
Which report is one of the three primary financial statements?
Statement of the accounting cycle
Statement of management accounting
Statement of cash flows
Statement of stakeholder funds
- Answer -Statement of cash flows
A company paid $5,000 cash in advertising costs.
How does this transaction affect the paying company's accounting
equation?
Assets decrease by $5,000; expenses increase by $5,000.
Assets increase by $5,000; expenses increase by $5,000.
Assets decrease by $5,000; revenues increase by $5,000.
pg. 4
