WGU C213 Pre-assessment (Accounting) 2024 Questions and Answers 100% Pass

WGU C213 Pre-assessment (Accounting) 2024 Questions and Answers 100% Pass What does accounting focus on? - The impact a business's activities have on its relationships with customers - The impact a business's activities have on the environment. - The impact a business's activities have on its public image. - The impact a business's activities have on its overall financial performance. - Answer- The impact a business's activities on its overall financial performance. Which report summarizes cash collections and cash expenditures from operating, investing, and financing activities over a period of time? - Cash receipts and disbursements sheet - Cash flow schedule - Summary of cash receipts - Statement of cash flows - Answer- Statement of cash flows Which users would have a primary concern with an organization's ability to provide healthcare benefits? - Competitors - Employees - Vendors - Suppliers - Answer- Employees Which benefit does a corporation gain by following Generally Accepted Accounting Principles (GAAP)? - A decrease in its income tax obligations - A decrease in the amount of net income it reports - An increase in its comparability to other companies - An increase in the amount of assets it reports - Answer- An increase in its comparability to other companies. Which body regulates a certified public accounting firm's audit practices when the firm is auditing a large publicly traded company? - The Public Company Accounting Oversight Board (PCAOB) - The Financial Accounting Standards Board (FASB) - Another certified public accounting firm (CPA) - The Internal Revenue Service (IRS) - Answer- The Public Company Accounting Oversight Board (PCAOB) What has had the most significant impact on accounting practices? - Answer- Information technology What two items of information are revealed on the balance sheet? - Answer- Ownership and Debt Which term is defined as the residual interest in the net assets of a company? - Answer- Owners' equity A corporation has a total liabilities of $300 million, total owners' equity of $100 million, and current assets of $50 million. What is the value of the firm's long-term assets? - Answer- $350 Million. Combine the liabilities with assets. Which situation should result in revenue recognition on the income statement for the year ending 12/31/14 if the firm is using accrual-basis accounting? - Answer- In 2014, a company provides services to a customer for which cash will be collected the next year (2015). Which category on the statement of cash flows summarizes cash receipts and payments to owners and creditors of the company? - Answer- Cash flows from financing activities Where would an investor find a summary of a company's significant accounting policies? - Answer- In the notes to financial statements Which assurance does an external audit report provide for its readers? - The company will be a good credit risk - The company will generate net income. - The company's financial statements fairly reflect its financial position. - The company will generate positive cash flows - Answer- The company's financial statements fairly reflect its financial position Order the steps in the decision cycle from first to last: Gather information, prepare financial statements, analyze financial statements, make decision, and implement decision. - Answer- Prepare financial statements, analyze financial statements, gather information, make decision, and implement decision Partial financial information for a company is as follows: Current assets $36,543 Total assets $58,719 Current liabilities $24,824 Total liabilities $48,561 Stockholders' equity $10,158 Sales$46,997 Net Income $3,761 Market value of shares $41,316 What is the price-earnings (PE) ratio for this company? - Answer- 11.0 Market value of shares/net income What does it mean if a company has a debt ratio of 101.5%? - Answer- The company has 1.5% more total liabilities than total assets. What is consistent with a continual decline in gross profit if the firm's cost of goods sold remains the same? - Continual decrease in salaries - Continual increase in interest - Continual increase in taxes - Continual decrease in sales - Answer- Continual decrease in sales Which two cash flow adequacy ratios represent a cash cow?: - 4,510/4932, - 6,991/5,486, - 8,091/9374, - 5220/1875, - or 7589/9210. - Answer- 6,991/5,486 and 5,220/1,875 Which formula yields a cash time interest earned ratio of 11? - Cash before interest and taxes of $11,000 / cash paid for income taxes of $1,000 - Cash before interest and taxes of $11,000 / cash paid for interest of $1,000 - Cash before interest and taxes of $11,000 / cash from operations of $1,000 - Cash before interest and taxes of $11,000 / cash paid for acquisitions of $1,000 - Answer- Cash before interest and taxes of $11,000/cash paid for interest of $1,000. Which form of debt should be reported in the long-term liability category? - Unearned revenue that will be earned in 9 months.