WGU C213 Accounting for Decision
Makers Exam-Graded A
Accounting - ANSWER-the recording of the day-to-day financial activities of a company
and the organization of that information into summary reports used to evaluate the
company's financial status
Bookkeeping - ANSWER-the preservation of a systematic, quantitative record of an
activity
accounting system - ANSWER-used by a business to handle routine bookkeeping tasks
and to structure the information so it can be used to evaluate the performance and
financial status of the business
Accounting information - ANSWER-Info that is intended to be useful in making decisions
about the future.
The balance sheet, the income statement, and the statement of cashflows - ANSWER-
What are the three primary financial statements?
External Users - ANSWER-Who is financial accounting information primarily prepared
for and used by?
Managerial Accounting - ANSWER-the name given to accounting systems designed for
internal users
Balance Sheet - ANSWER-Reports a company's assets, liabilities, and owners' equity
Income Statement - ANSWER-reports the amount of net income earned by a company
during a period
Net income - ANSWER-the excess of a company's revenues over its expenses
statement of cash flows - ANSWER-reports the amount of cash collected and paid out
by a company in the following three types of activities: operating, investing, and
financing
FASB - ANSWER-Which private body establishes accounting rules in the U.S.?
, When work has been done and collectability of cash can be reasonably assured -
ANSWER-According to accounting rules, when should revenue be recognized?
Operating activities - ANSWER-those activities that comprise the day-to-day operations
of a business.
Investing activities - ANSWER-The purchase and sale of long-term assets such as land
and equipment are known as _______________.
Financing activities - ANSWER-those activities through which cash is obtained from, or
repaid to, creditors and investors
information on the accounting assumptions used in preparing the statements and
supplemental information not included in the statements themselves - ANSWER-What
information do the notes to accounting statements provide?
1. Summary of accounting policy
2. Additional info about summary totals
3. Disclosure of info not included in summary
4. Supplemental disclosure required by FASB or SEC - ANSWER-What are the 4
general types of accounting notes?
Conservatism - ANSWER-the practice of recognizing all losses but not recognizing
gains until they are certain
Materiality - ANSWER-the concept that weighs whether a certain dollar amount is large
enough to make a difference to anyone
Articulation - ANSWER-the idea that the three primary financial statements are
interrelated
Debt Ratio
Total Liabilities/
Total Assets - ANSWER-Percentage of funds needed to purchase assets that were
obtained through borrowing
Current Ratio
Current Assets/
Current Liabilities - ANSWER-Measure of liquidity; number of times current assets could
cover current liabilities
Return on Sales Ratio
Net Income/
Makers Exam-Graded A
Accounting - ANSWER-the recording of the day-to-day financial activities of a company
and the organization of that information into summary reports used to evaluate the
company's financial status
Bookkeeping - ANSWER-the preservation of a systematic, quantitative record of an
activity
accounting system - ANSWER-used by a business to handle routine bookkeeping tasks
and to structure the information so it can be used to evaluate the performance and
financial status of the business
Accounting information - ANSWER-Info that is intended to be useful in making decisions
about the future.
The balance sheet, the income statement, and the statement of cashflows - ANSWER-
What are the three primary financial statements?
External Users - ANSWER-Who is financial accounting information primarily prepared
for and used by?
Managerial Accounting - ANSWER-the name given to accounting systems designed for
internal users
Balance Sheet - ANSWER-Reports a company's assets, liabilities, and owners' equity
Income Statement - ANSWER-reports the amount of net income earned by a company
during a period
Net income - ANSWER-the excess of a company's revenues over its expenses
statement of cash flows - ANSWER-reports the amount of cash collected and paid out
by a company in the following three types of activities: operating, investing, and
financing
FASB - ANSWER-Which private body establishes accounting rules in the U.S.?
, When work has been done and collectability of cash can be reasonably assured -
ANSWER-According to accounting rules, when should revenue be recognized?
Operating activities - ANSWER-those activities that comprise the day-to-day operations
of a business.
Investing activities - ANSWER-The purchase and sale of long-term assets such as land
and equipment are known as _______________.
Financing activities - ANSWER-those activities through which cash is obtained from, or
repaid to, creditors and investors
information on the accounting assumptions used in preparing the statements and
supplemental information not included in the statements themselves - ANSWER-What
information do the notes to accounting statements provide?
1. Summary of accounting policy
2. Additional info about summary totals
3. Disclosure of info not included in summary
4. Supplemental disclosure required by FASB or SEC - ANSWER-What are the 4
general types of accounting notes?
Conservatism - ANSWER-the practice of recognizing all losses but not recognizing
gains until they are certain
Materiality - ANSWER-the concept that weighs whether a certain dollar amount is large
enough to make a difference to anyone
Articulation - ANSWER-the idea that the three primary financial statements are
interrelated
Debt Ratio
Total Liabilities/
Total Assets - ANSWER-Percentage of funds needed to purchase assets that were
obtained through borrowing
Current Ratio
Current Assets/
Current Liabilities - ANSWER-Measure of liquidity; number of times current assets could
cover current liabilities
Return on Sales Ratio
Net Income/
