WGU C214 FINANCIAL MANAGEMENT CONCEPTS QUESTIONS & ANSWERS 2026-… EXAM
P R O F E S S I O N A L P R A C T I C E M AT E R I A L S
WGU C214 Financial
Management Concepts
Questions & Answers 2026-
2027 | Objective Assessment
Review
Verified Answers Exam Ready With Rationales
92 QUESTIONS
DOCUMENT OVERVIEW
This document provides 92 verified questions with correct answers related to financial management
concepts, ensuring clarity on critical principles. It serves as a comprehensive resource for mastering
financial management, directly aligning with academic and certification preparation. Students can utilize
this material for effective study and review, reinforcing their understanding of key financial principles and
enhancing their readiness for assessments.
CONTENTS
Financial Instruments Q1–Q14
Financial Statements Q15–Q27
Market Dynamics Q28–Q40
Page 1
, Risk and Return Q41–Q53
Regulatory Environment Q54–Q66
Market Efficiency Q67–Q79
Valuation Concepts Q80–Q92
E XA M Q U EST I O N S
Q1 QUESTION 1 OF 92
Trading on the NYSE is executed without a specialist (i.e. a market maker). (T/F)
CORRECT ANSWER
F
Q2 QUESTION 2 OF 92
Stocks and bonds are two types of financial instruments (T/F)
CORRECT ANSWER
T
Q3 QUESTION 3 OF 92
The matching principle in accrual accounting requires that:
a. Revenues be recognized when the earnings process is complete and matches expenses to revenues
recognized.
b. Expenses are matched to the year in which they are incurred
c. Revenues are matched to the year in which they are booked
d. Revenues should be large enough to match expenses
CORRECT ANSWER
a
Q4 QUESTION 4 OF 92
Page 2
, A basic equation for the balance sheet is:
a. Equity = Assets - Liabilities
b. Liabilities = Equity + Assets
c. Assets = Liabilities - Equity
d. Assets = Equity - Liabilities
CORRECT ANSWER
a
Q5 QUESTION 5 OF 92
Why is the Balance Sheet known as a permanent statement?
a. Because the statement is sent to the SEC.
b. Because the other statements are reset at the end of the fiscal year
c. Because it is printed out and archived
d. Because it persists in the minds of the shareholders.
CORRECT ANSWER
b
Q6 QUESTION 6 OF 92
How do you calculate the change in Retained Earnings?
a. Ending Retained Earnings - Change in Cash
b. EBIT divided by Total Assets + Dividends
c. EBIT - Change in Cash - Dividends
d. Net Income - Dividends
CORRECT ANSWER
d
Q7 QUESTION 7 OF 92
Which of the following is generally true?
a. Gross Profit and Operating Income are the same
b. Cost of Goods Sold + Operating Expenses = Net Income
Page 3
P R O F E S S I O N A L P R A C T I C E M AT E R I A L S
WGU C214 Financial
Management Concepts
Questions & Answers 2026-
2027 | Objective Assessment
Review
Verified Answers Exam Ready With Rationales
92 QUESTIONS
DOCUMENT OVERVIEW
This document provides 92 verified questions with correct answers related to financial management
concepts, ensuring clarity on critical principles. It serves as a comprehensive resource for mastering
financial management, directly aligning with academic and certification preparation. Students can utilize
this material for effective study and review, reinforcing their understanding of key financial principles and
enhancing their readiness for assessments.
CONTENTS
Financial Instruments Q1–Q14
Financial Statements Q15–Q27
Market Dynamics Q28–Q40
Page 1
, Risk and Return Q41–Q53
Regulatory Environment Q54–Q66
Market Efficiency Q67–Q79
Valuation Concepts Q80–Q92
E XA M Q U EST I O N S
Q1 QUESTION 1 OF 92
Trading on the NYSE is executed without a specialist (i.e. a market maker). (T/F)
CORRECT ANSWER
F
Q2 QUESTION 2 OF 92
Stocks and bonds are two types of financial instruments (T/F)
CORRECT ANSWER
T
Q3 QUESTION 3 OF 92
The matching principle in accrual accounting requires that:
a. Revenues be recognized when the earnings process is complete and matches expenses to revenues
recognized.
b. Expenses are matched to the year in which they are incurred
c. Revenues are matched to the year in which they are booked
d. Revenues should be large enough to match expenses
CORRECT ANSWER
a
Q4 QUESTION 4 OF 92
Page 2
, A basic equation for the balance sheet is:
a. Equity = Assets - Liabilities
b. Liabilities = Equity + Assets
c. Assets = Liabilities - Equity
d. Assets = Equity - Liabilities
CORRECT ANSWER
a
Q5 QUESTION 5 OF 92
Why is the Balance Sheet known as a permanent statement?
a. Because the statement is sent to the SEC.
b. Because the other statements are reset at the end of the fiscal year
c. Because it is printed out and archived
d. Because it persists in the minds of the shareholders.
CORRECT ANSWER
b
Q6 QUESTION 6 OF 92
How do you calculate the change in Retained Earnings?
a. Ending Retained Earnings - Change in Cash
b. EBIT divided by Total Assets + Dividends
c. EBIT - Change in Cash - Dividends
d. Net Income - Dividends
CORRECT ANSWER
d
Q7 QUESTION 7 OF 92
Which of the following is generally true?
a. Gross Profit and Operating Income are the same
b. Cost of Goods Sold + Operating Expenses = Net Income
Page 3
