WGU C213 Accounting for Decision Makers ABCD .

WGU C213 Accounting for Decision Makers ABCD 2022/2023 WGU C213 Accounting for Decision Makers ABCD 2022/2023 1. Accountinganswer 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 2. Bookkeepinganswer the preservation of a systematic, quantitative record of an activity 3. accounting systemanswer 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 4. Accounting informationanswer Info that is intended to be useful in making decisions about the future. 5. The balance sheet, the income statement, and the statement of cashflows- answer What are the three primary financial statements? 6. External Usersanswer Who is financial accounting information primarily prepared for and used by? 7. Managerial Accountinganswer the name given to accounting systems designed for internal users 8. Balance Sheetanswer Reports a company's assets, liabilities, and owners' equity 9. Income Statementanswer reports the amount of net income earned by a company during a period 10. Net incomeanswer the excess of a company's revenues over its expenses 11. statement of cash flowsanswer reports the amount of cash collected and paid out by a company in the following three types of activitiesoperating, investing, and financing 12. FASBanswer Which private body establishes accounting rules in the U.S.? 13. Financial Accounting Standards Board (FASB)answer a private body established and supported by the joint efforts of the U.S. business community, financial ana- lysts, and practicing accountants 14. The Securities and Exchange Commission (SEC)answer the organization that regulates U.S. stock exchanges and seeks to create a fair information environment in which investors can buy and sell stocks without fear that companies are hiding or manipulating financial data 15. American Institute of Certified Public Accountants (AICPA)answer the profes- sional organization of certified public accountants (CPAs) in the United States 16. Public Company Accounting Oversight Board (PCAOB)answer the organization that inspects the audit practices of registered audit firms and has statutory authority to investigate questionable audit practices and to impose sanctions such as barring an audit firm from auditing SEC-registered companies 17. Internal Revenue Service (IRS)answer Gov't agency that establishes rules to define exactly when income should be taxed. It has no role in setting financial accounting rules; and a company's financial statements are not used in determining how much tax the company must pay 18. The International Accounting Standards Board (IASB)answer Organization that was formed to develop a common set of worldwide accounting standards. Its stan- dards are increasingly accepted worldwide, but FASB rules are still the standard in the United States. 19. 1. Rapid Advancements in the IT field 2. the international integration of worldwide business 3. Increased scrutiny associated with large corporate accounting scandals- answer Which 3 factors have combined to make right now a time of significant change in accounting? 20. Sarbanes-Oxley Actanswer A wave of accounting scandals starting in 2001 resulted in this act, which increases U.S. federal government scrutiny of the production of financial statements. 21. Balance Sheetanswer reports a company's financial position at a specified point in time and lists the company's resources (assets), obligations (liabilities), and net ownership interest (owners' equity). 22. Assetsanswer probable future economic benefits obtained or controlled by a compa- ny as a result of past transactions or events 23. Liabilitiesanswer probable future sacrifices of economic benefits arising from pre- sent obligations of a company to transfer assets or provide services in the future as a result of past transactions or events 24. Owners' equityanswer the residual interest in the assets of a company that remains after deducting its liabilities 25. Assets = Liabilities + Owners' Equityanswer What is the accounting equation? 26. By order of liquidityanswer In what order are assets typically listed on the balance sheet? 27. Current and Long-termanswer Liabilities are divided into which 2 categories on the balance sheet? 28. states that the financial results of an economic entity should be reported separately from the financial results of other entities, even though all those entities may be controlled by the same personanswer What is the entity concept? 29. (revenues-expense= net income)answer Equation to calculate net income 30. When work has been done and collectability of cash can be reasonably assuredanswer According to accounting rules, when should revenue be recognized? 31. Operating activitiesanswer those activities that comprise the day-to-day operations of a business. 32. Investing activitiesanswer The purchase and sale of long-term assets such as land and equipment are known as . 33. Financing activitiesanswer those activities through which cash is obtained from, or repaid to, creditors and investors 34. information on the accounting assumptions used in preparing the state- ments and supplemental information not included in the statements them- selvesanswer What information do the notes to accounting statements provide? 35. 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 SECanswer What are the 4 general types of accounting notes? 36. Conservatismanswer the practice of recognizing all losses but not recognizing gains until they are certain 37. Materialityanswer the concept that weighs whether a certain dollar amount is large enough to make a difference to anyone 38. Articulationanswer the idea that the three primary financial statements are interre- lated 39. Debt Ratio Total Liabilities/ Total Assetsanswer Percentage of funds needed to purchase assets that were obtained through borrowing 40. Current Ratio Current Assets/