WGU C213 Accounting for Decision Makers — Latest
Objective Assessment Practice Exam 2026: 200
MCQs with Answers
1. Which financial statement reports a company's financial position at a specific point
in time?
A. Income statement
B. Statement of cash flows
C. Balance sheet
D. Statement of retained earnings
2. Which accounting equation is correct?
A. Assets = Liabilities − Equity
B. Assets + Liabilities = Equity
C. Assets = Revenue + Expenses
D. Assets = Liabilities + Equity
3. Which account normally has a debit balance?
A. Accounts payable
B. Common stock
C. Sales revenue
D. Accounts receivable
4. Revenue is generally recognized when:
,A. Cash is always received
B. An invoice is printed
C. The company satisfies its performance obligation
D. A customer places an order
5. Which financial statement measures revenues and expenses over a period?
A. Balance sheet
B. Income statement
C. Statement of cash flows
D. Trial balance
6. What is the primary purpose of financial accounting?
A. To determine employee schedules
B. To establish product prices only
C. To provide financial information to external users
D. To eliminate business risk
7. Which of the following is a current asset?
A. Building
B. Equipment
C. Long-term investment
D. Accounts receivable
8. Which of the following is a current liability?
A. Mortgage payable due in 15 years
B. Common stock
,C. Accounts payable
D. Retained earnings
9. Retained earnings represents:
A. Cash held by a company
B. Total liabilities
C. Cumulative earnings retained in the business, less distributions
D. Total revenue for the current year
10. Which transaction increases both assets and liabilities?
A. Paying an account payable
B. Paying dividends
C. Purchasing equipment with a loan
D. Collecting an account receivable
11. A company purchases supplies for cash. What is the immediate effect?
A. Assets increase and liabilities increase
B. Assets decrease and equity decreases
C. One asset increases while another asset decreases
D. Liabilities decrease and equity increases
12. Which account is classified as an expense?
A. Unearned revenue
B. Accounts payable
C. Equipment
D. Utilities expense
, 13. The matching principle requires companies to:
A. Record all transactions when cash changes hands
B. Match assets with liabilities
C. Recognize expenses in the period in which related revenues are recognized
D. Match liabilities with equity
14. Depreciation is best described as:
A. A decline in market value
B. An increase in accumulated cash
C. The systematic allocation of an asset's depreciable cost over its useful life
D. A direct reduction of revenue
15. Which depreciation method generally produces equal depreciation expense each
year?
A. Double-declining balance
B. Units-of-production
C. Sum-of-the-years'-digits
D. Straight-line
16. A machine costs $50,000, has a $5,000 residual value, and a five-year useful life.
What is annual straight-line depreciation?
A. $5,000
B. $9,000
C. $9,000
D. $10,000
Objective Assessment Practice Exam 2026: 200
MCQs with Answers
1. Which financial statement reports a company's financial position at a specific point
in time?
A. Income statement
B. Statement of cash flows
C. Balance sheet
D. Statement of retained earnings
2. Which accounting equation is correct?
A. Assets = Liabilities − Equity
B. Assets + Liabilities = Equity
C. Assets = Revenue + Expenses
D. Assets = Liabilities + Equity
3. Which account normally has a debit balance?
A. Accounts payable
B. Common stock
C. Sales revenue
D. Accounts receivable
4. Revenue is generally recognized when:
,A. Cash is always received
B. An invoice is printed
C. The company satisfies its performance obligation
D. A customer places an order
5. Which financial statement measures revenues and expenses over a period?
A. Balance sheet
B. Income statement
C. Statement of cash flows
D. Trial balance
6. What is the primary purpose of financial accounting?
A. To determine employee schedules
B. To establish product prices only
C. To provide financial information to external users
D. To eliminate business risk
7. Which of the following is a current asset?
A. Building
B. Equipment
C. Long-term investment
D. Accounts receivable
8. Which of the following is a current liability?
A. Mortgage payable due in 15 years
B. Common stock
,C. Accounts payable
D. Retained earnings
9. Retained earnings represents:
A. Cash held by a company
B. Total liabilities
C. Cumulative earnings retained in the business, less distributions
D. Total revenue for the current year
10. Which transaction increases both assets and liabilities?
A. Paying an account payable
B. Paying dividends
C. Purchasing equipment with a loan
D. Collecting an account receivable
11. A company purchases supplies for cash. What is the immediate effect?
A. Assets increase and liabilities increase
B. Assets decrease and equity decreases
C. One asset increases while another asset decreases
D. Liabilities decrease and equity increases
12. Which account is classified as an expense?
A. Unearned revenue
B. Accounts payable
C. Equipment
D. Utilities expense
, 13. The matching principle requires companies to:
A. Record all transactions when cash changes hands
B. Match assets with liabilities
C. Recognize expenses in the period in which related revenues are recognized
D. Match liabilities with equity
14. Depreciation is best described as:
A. A decline in market value
B. An increase in accumulated cash
C. The systematic allocation of an asset's depreciable cost over its useful life
D. A direct reduction of revenue
15. Which depreciation method generally produces equal depreciation expense each
year?
A. Double-declining balance
B. Units-of-production
C. Sum-of-the-years'-digits
D. Straight-line
16. A machine costs $50,000, has a $5,000 residual value, and a five-year useful life.
What is annual straight-line depreciation?
A. $5,000
B. $9,000
C. $9,000
D. $10,000
