WGU C213 Final Exam study
guide
With Answers Graded A+
Latest
1. Order of assets listed on the balance sheet: Assets are listed in the order
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of liquidity. Liquidity is the amount of time it would usually take to covert a
g g g g g g g g g g g g g g
n asset into c
g g g
ash. Obviously, cash would be listed first, followed by marketable investm
g g g g g g g g g g
ents (a com pany can quickly convert a short-
g g g g g g g
term investment into cash). Accounts receivable would be listed next follo
g g g g g g g g g g
wed by inve ntory, and long-
g g g g
term investments, fixed assets, and intangibles.
g g g g g
Current assets are listed before long-term assets.
g g g g g g
Current liabilities are listed before long-
g g g g g
term liabilities, but there is no specific order they are listed in outside of cu
g g g g g g g g g g g g g g
rrent and lo ng-term.
g g
There is also no specific order equity accounts are listed on the balance sh
g g g g g g g g g g g g g
eet; althou gh, typically you will see paid-in-
g g g g g g
capital followed by retained earnings followed by accumulated other com
g g g g g g g g g
prehensive i ncome, and lastly, treasury stock.
g g g g g
2. Difference between a manufacturing company and a service company.
g g g g g g g g
,Period Costs Product Costs
g g g
1
, Service Co. Selling Costs Direct Labor Administrative
g g g g g g
g Costs Service Overhead
g g
Manufacturing Co Selling Costs Direct Labor Administrative g g g g g g
g Costs Manufacturing Overhead
g g
Direct Materials (inventory: The only difference is -
g g g g g g g
g a manufacturing company has direct materials (inv
g g g g g g
entory).
3. Evaluating a historical income statement to project a future income state-
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g ment.
Projected growth for 2017 = 10% increase over 2016 sales.
g g g g g g g g g
Step 1: Convert the income statement into a common-
g g e statement.
g g g g g g g
asted 2017 g g
sized incom Step 2: Multiply 2016 sales by 1.10 (10% growth) to get the
g g g g g g g g g g g g g g
forec
sales. Then multiply the projected 2017 sales by the percentages from step 1.
g g g g g g g g g g g g g
N
ow, what would you do if you were given the 2017 sales figure and you need to
g g g g g g g g g g g g g g g g g
c alculate the 2016 sales figure based off the 10% growth for 2017?: Calcu-
g g g g g g g g g g g g
g lation for 2016: 110,.10 = 100,000
g g g g g g g
4. Role of the U. S. Securities and Exchange Commission (SEC) in financial r
g g g g g g g g g g g g
eporting.: Regulates the U.S. Stock exchanges.
g g g g g
Seeks to create a fair information environment in which investors can buy and
g g g g g g g g g g g g g
sell sto g
cks.
, 2
guide
With Answers Graded A+
Latest
1. Order of assets listed on the balance sheet: Assets are listed in the order
g g g g g g g g g g g g g
of liquidity. Liquidity is the amount of time it would usually take to covert a
g g g g g g g g g g g g g g
n asset into c
g g g
ash. Obviously, cash would be listed first, followed by marketable investm
g g g g g g g g g g
ents (a com pany can quickly convert a short-
g g g g g g g
term investment into cash). Accounts receivable would be listed next follo
g g g g g g g g g g
wed by inve ntory, and long-
g g g g
term investments, fixed assets, and intangibles.
g g g g g
Current assets are listed before long-term assets.
g g g g g g
Current liabilities are listed before long-
g g g g g
term liabilities, but there is no specific order they are listed in outside of cu
g g g g g g g g g g g g g g
rrent and lo ng-term.
g g
There is also no specific order equity accounts are listed on the balance sh
g g g g g g g g g g g g g
eet; althou gh, typically you will see paid-in-
g g g g g g
capital followed by retained earnings followed by accumulated other com
g g g g g g g g g
prehensive i ncome, and lastly, treasury stock.
g g g g g
2. Difference between a manufacturing company and a service company.
g g g g g g g g
,Period Costs Product Costs
g g g
1
, Service Co. Selling Costs Direct Labor Administrative
g g g g g g
g Costs Service Overhead
g g
Manufacturing Co Selling Costs Direct Labor Administrative g g g g g g
g Costs Manufacturing Overhead
g g
Direct Materials (inventory: The only difference is -
g g g g g g g
g a manufacturing company has direct materials (inv
g g g g g g
entory).
3. Evaluating a historical income statement to project a future income state-
g g g g g g g g g g
g ment.
Projected growth for 2017 = 10% increase over 2016 sales.
g g g g g g g g g
Step 1: Convert the income statement into a common-
g g e statement.
g g g g g g g
asted 2017 g g
sized incom Step 2: Multiply 2016 sales by 1.10 (10% growth) to get the
g g g g g g g g g g g g g g
forec
sales. Then multiply the projected 2017 sales by the percentages from step 1.
g g g g g g g g g g g g g
N
ow, what would you do if you were given the 2017 sales figure and you need to
g g g g g g g g g g g g g g g g g
c alculate the 2016 sales figure based off the 10% growth for 2017?: Calcu-
g g g g g g g g g g g g
g lation for 2016: 110,.10 = 100,000
g g g g g g g
4. Role of the U. S. Securities and Exchange Commission (SEC) in financial r
g g g g g g g g g g g g
eporting.: Regulates the U.S. Stock exchanges.
g g g g g
Seeks to create a fair information environment in which investors can buy and
g g g g g g g g g g g g g
sell sto g
cks.
, 2
