Accounting for decision makers C213 WGU Questions with Correct
Answers 100% and Answers with Verified Solutions | Latest 2026
Update
Q: What does Sarbanes-Oxley require management to do?
Answer:
Develop and enforce an officer code of ethics, Support a much stronger board and
audit committee in each public company, Prepare a statement to accompany the audit
report The Public Company Accounting Oversight Board Conducts inspections of
accounting firms Which audit processes is used primarily by external auditors and
not by internal auditors? confirmation. Internal auditors use: interviewing, sampling,
and observation What activities would internal auditors NOT typically perform in a
large company? Prepare the primary financial statements. It would typically perform:
Detect fraud, Assist with increasing the efficiency of operations, Evaluate internal
controls. What are incentives that influences auditors to remain independent and to
provide fair and reliable financial information? Auditors have a reputation to protect.
Management would be taking a large legal risk if they interfere with the auditors.
External auditors are taking a large legal risk if they allow their independence and
integrity to be compromised Which statement best describes the role of external
auditors when auditing a large public company? Examine the organization's
accounting for a sample of business transactions to provide reasonable assurance that
the financial statements are presented fairly When does the Securities and Exchange
Commission (SEC) typically require a company to submit a registration statement to
the SEC for approval? When the company issues new debt or stock securities to the
public The effects that the Securities Exchange Act of 1934 had on accountants?
Accountants must audit all 10-K reports, Accountants' work is subject to approval by
the SEC.
,Q: Unintentional mistakes that can enter the accounting system at the transaction
and journal
Answer:
entry stage or when journal entries are posted to accounts. Errors
Intentional misrepresentations in the financial statements Fraud
Differences in opinion about what numbers should be reported in the financial
statements
based on different estimates Disagreements in judgment
The three basic internal control structure categories are The control environment
The accounting systems
The control procedures
The five types of control procedures are Segregation of duties
Procedures for authorizations
Documents and records
Physical safeguards
Independent checks
Reasons for earnings management Pressure to meet internal earnings targets
Pressure to meet external expectations
Smoothing income
Preparing to apply for a loan or to offer stock to the public
Techniques of earnings management Careful timing of transactions
Changing accounting methods or estimates with full disclosure
Changing accounting methods or estimates withOUT adequate disclosure
,Q: Non-GAAP accounting
Answer:
Fictitious transactions
Public Company Accounting Oversight register all public accounting firms.
Board (PCAOB) Establish auditing standards.
Inspect public accounting firms.
Constraints on auditors Auditors are prohibited from providing nonaudit services to
audit
clients.
Audit partners must rotate every five years.
Auditors must report to the audit committee of the board of directors.
Constraints on management The CEO and the CFO must personally certify the
reliability of
the financial statements.
Companies must have a code of ethics.
Loans to company executives are prohibited.
Audit committees must be strengthened.
Internal auditors Evaluate internal controls
Monitor operating results
Ensure compliance with laws and company policy
Detect fraud
External auditors Gather evidence to be able to certify the fairness of the financial
statements through:
Interviews
Observation
, Q: Sampling
Answer:
Confirmation
Analytical procedures
The SEC adds credibility to financial statements by
Requiring independent audits Requiring independent audits
Reviewing financial statements itself
Sanctioning firms that violate its standards
Good management accounting is motivated by: Management desire to improve
Management accounting Unique competitive tool, Both financial and non financial
data,
Data usually kept secret within the company,Used for internal planning, control, and
evaluation
Financial accounting Uniform across companies (generally accepted accounting
principles),
Restricted to financial data, data is made public,Used primarily by investors and
creditors in
deciding whether to provide capital to the company.
The allocation of which of the following can cause the greatest errors when
computing product
costs? Manufacturing overhead
ABC assume that: Activities that consume overhead cost
Traditional product costing systems (e.g. job order costing and process costing)
usually assume
that: Products consume overhead costs.
5 steps of ABC system Identify overhead cost activities, analyze individual overhead
costs in
terms of those cost activities, identify measurable cost drivers, assign overhead, and
use the
cost data to make decisions
Answers 100% and Answers with Verified Solutions | Latest 2026
Update
Q: What does Sarbanes-Oxley require management to do?
Answer:
Develop and enforce an officer code of ethics, Support a much stronger board and
audit committee in each public company, Prepare a statement to accompany the audit
report The Public Company Accounting Oversight Board Conducts inspections of
accounting firms Which audit processes is used primarily by external auditors and
not by internal auditors? confirmation. Internal auditors use: interviewing, sampling,
and observation What activities would internal auditors NOT typically perform in a
large company? Prepare the primary financial statements. It would typically perform:
Detect fraud, Assist with increasing the efficiency of operations, Evaluate internal
controls. What are incentives that influences auditors to remain independent and to
provide fair and reliable financial information? Auditors have a reputation to protect.
Management would be taking a large legal risk if they interfere with the auditors.
External auditors are taking a large legal risk if they allow their independence and
integrity to be compromised Which statement best describes the role of external
auditors when auditing a large public company? Examine the organization's
accounting for a sample of business transactions to provide reasonable assurance that
the financial statements are presented fairly When does the Securities and Exchange
Commission (SEC) typically require a company to submit a registration statement to
the SEC for approval? When the company issues new debt or stock securities to the
public The effects that the Securities Exchange Act of 1934 had on accountants?
Accountants must audit all 10-K reports, Accountants' work is subject to approval by
the SEC.
,Q: Unintentional mistakes that can enter the accounting system at the transaction
and journal
Answer:
entry stage or when journal entries are posted to accounts. Errors
Intentional misrepresentations in the financial statements Fraud
Differences in opinion about what numbers should be reported in the financial
statements
based on different estimates Disagreements in judgment
The three basic internal control structure categories are The control environment
The accounting systems
The control procedures
The five types of control procedures are Segregation of duties
Procedures for authorizations
Documents and records
Physical safeguards
Independent checks
Reasons for earnings management Pressure to meet internal earnings targets
Pressure to meet external expectations
Smoothing income
Preparing to apply for a loan or to offer stock to the public
Techniques of earnings management Careful timing of transactions
Changing accounting methods or estimates with full disclosure
Changing accounting methods or estimates withOUT adequate disclosure
,Q: Non-GAAP accounting
Answer:
Fictitious transactions
Public Company Accounting Oversight register all public accounting firms.
Board (PCAOB) Establish auditing standards.
Inspect public accounting firms.
Constraints on auditors Auditors are prohibited from providing nonaudit services to
audit
clients.
Audit partners must rotate every five years.
Auditors must report to the audit committee of the board of directors.
Constraints on management The CEO and the CFO must personally certify the
reliability of
the financial statements.
Companies must have a code of ethics.
Loans to company executives are prohibited.
Audit committees must be strengthened.
Internal auditors Evaluate internal controls
Monitor operating results
Ensure compliance with laws and company policy
Detect fraud
External auditors Gather evidence to be able to certify the fairness of the financial
statements through:
Interviews
Observation
, Q: Sampling
Answer:
Confirmation
Analytical procedures
The SEC adds credibility to financial statements by
Requiring independent audits Requiring independent audits
Reviewing financial statements itself
Sanctioning firms that violate its standards
Good management accounting is motivated by: Management desire to improve
Management accounting Unique competitive tool, Both financial and non financial
data,
Data usually kept secret within the company,Used for internal planning, control, and
evaluation
Financial accounting Uniform across companies (generally accepted accounting
principles),
Restricted to financial data, data is made public,Used primarily by investors and
creditors in
deciding whether to provide capital to the company.
The allocation of which of the following can cause the greatest errors when
computing product
costs? Manufacturing overhead
ABC assume that: Activities that consume overhead cost
Traditional product costing systems (e.g. job order costing and process costing)
usually assume
that: Products consume overhead costs.
5 steps of ABC system Identify overhead cost activities, analyze individual overhead
costs in
terms of those cost activities, identify measurable cost drivers, assign overhead, and
use the
cost data to make decisions
