WGU D196- Principles of Financial and Managerial
Accounting Exam Review 2024/ Complete 200 Real
Exam Questions with Correct Verified Answers/
Graded A+
Which primary area of accounting generates reports for internal users? - Correct
Answer - Management accounting generates reports for internal users, such as budgets
and cost analyses.
What are the principal sources of a company's cash inflows? - Correct Answer - Cash
sales and the collection of cash from prior credit sales
For what purpose are column charts used? - Correct Answer - To compare different
categories of items or the same category over time
What are the principal sources of a company's cash inflows? - Correct Answer - Cash
sales and the collection of cash from prior credit sales
The master budgeting process begins with which forecast? - Correct Answer - A
forecast of sales
The sales and administrative expense budget includes which expenses? - Correct
Answer - All expenses besides production-related expenses
The manufacturing overhead cost budget includes which manufacturing costs? - Correct
Answer - Both fixed and variable manufacturing overhead costs
The production budget supplies the information required for which other budget in the
master budgeting process? - Correct Answer - Direct materials budget
pg. 1
,Segment managers should be evaluated on which items included in a budget? - Correct
Answer - Only the items they can control or influence
What is the segment margin? - Correct Answer - The difference between segment
revenue and direct segment costs
Which items does a manager have control over in a cost center? - Correct Answer -
Costs only
Which items does a manager have control over in a profit center? - Correct Answer -
Costs and revenues
What is the concept behind responsibility accounting in management accounting? -
Correct Answer - A manager should be evaluated only on factors he or she can directly
control.
What is the first thing an accountant should do to develop a master budget? - Correct
Answer - Prepare a sales budget
What is the third factor required to prepare a production budget? - Correct Answer -
Projected sales volume
How is a cost variance computed for a corporate budget? - Correct Answer - A cost
variance is the difference between the actual cost and the budgeted cost.
What factors should the production supervisor consider in assembling her production
budget? - Correct Answer - Projected sales, desired ending inventory, and amount of
beginning inventory
What is the meaning of a significant cost variance? - Correct Answer - Corrective action
should be taken to eliminate the variance.
pg. 2
, What is a profit center? - Correct Answer - An organizational unit in which a manager
has responsibility for both costs and revenues
What is an indirect cost? - Correct Answer - A cost that a segment manager cannot
control
What is capital budgeting? - Correct Answer - Planning for the acquisition of property,
plant, and equipment
Projecting accurate sales is very difficult because sales are a function of both
uncontrollable external variables and controllable internal variables. Which variable
below is an uncontrollable external variable? - Correct Answer - Customer tastes
There are three important factors to be considered in preparing a production budget.
Which item below is one of those factors? - Correct Answer - Desired amount of ending
inventory
What label is given to a business unit in which the manager is responsible for costs,
revenues, and assets? - Correct Answer - Investment center
Which group uses financial information to evaluate whether a company will be able to
repay a loan? - Correct Answer - Lenders
Which of the primary financial statements reports the resources, obligations, and
owner's equity of a company? - Correct Answer - The balance sheet reports the
resources of a company (the assets), the company's obligations (the liabilities), and the
owners' equity, which represents the difference between what is owned (assets) and
what is owed (liabilities).
What is the role of the IASB in regulating accounting standards? - Correct Answer -
Establish international accounting standards
pg. 3
Accounting Exam Review 2024/ Complete 200 Real
Exam Questions with Correct Verified Answers/
Graded A+
Which primary area of accounting generates reports for internal users? - Correct
Answer - Management accounting generates reports for internal users, such as budgets
and cost analyses.
What are the principal sources of a company's cash inflows? - Correct Answer - Cash
sales and the collection of cash from prior credit sales
For what purpose are column charts used? - Correct Answer - To compare different
categories of items or the same category over time
What are the principal sources of a company's cash inflows? - Correct Answer - Cash
sales and the collection of cash from prior credit sales
The master budgeting process begins with which forecast? - Correct Answer - A
forecast of sales
The sales and administrative expense budget includes which expenses? - Correct
Answer - All expenses besides production-related expenses
The manufacturing overhead cost budget includes which manufacturing costs? - Correct
Answer - Both fixed and variable manufacturing overhead costs
The production budget supplies the information required for which other budget in the
master budgeting process? - Correct Answer - Direct materials budget
pg. 1
,Segment managers should be evaluated on which items included in a budget? - Correct
Answer - Only the items they can control or influence
What is the segment margin? - Correct Answer - The difference between segment
revenue and direct segment costs
Which items does a manager have control over in a cost center? - Correct Answer -
Costs only
Which items does a manager have control over in a profit center? - Correct Answer -
Costs and revenues
What is the concept behind responsibility accounting in management accounting? -
Correct Answer - A manager should be evaluated only on factors he or she can directly
control.
What is the first thing an accountant should do to develop a master budget? - Correct
Answer - Prepare a sales budget
What is the third factor required to prepare a production budget? - Correct Answer -
Projected sales volume
How is a cost variance computed for a corporate budget? - Correct Answer - A cost
variance is the difference between the actual cost and the budgeted cost.
What factors should the production supervisor consider in assembling her production
budget? - Correct Answer - Projected sales, desired ending inventory, and amount of
beginning inventory
What is the meaning of a significant cost variance? - Correct Answer - Corrective action
should be taken to eliminate the variance.
pg. 2
, What is a profit center? - Correct Answer - An organizational unit in which a manager
has responsibility for both costs and revenues
What is an indirect cost? - Correct Answer - A cost that a segment manager cannot
control
What is capital budgeting? - Correct Answer - Planning for the acquisition of property,
plant, and equipment
Projecting accurate sales is very difficult because sales are a function of both
uncontrollable external variables and controllable internal variables. Which variable
below is an uncontrollable external variable? - Correct Answer - Customer tastes
There are three important factors to be considered in preparing a production budget.
Which item below is one of those factors? - Correct Answer - Desired amount of ending
inventory
What label is given to a business unit in which the manager is responsible for costs,
revenues, and assets? - Correct Answer - Investment center
Which group uses financial information to evaluate whether a company will be able to
repay a loan? - Correct Answer - Lenders
Which of the primary financial statements reports the resources, obligations, and
owner's equity of a company? - Correct Answer - The balance sheet reports the
resources of a company (the assets), the company's obligations (the liabilities), and the
owners' equity, which represents the difference between what is owned (assets) and
what is owed (liabilities).
What is the role of the IASB in regulating accounting standards? - Correct Answer -
Establish international accounting standards
pg. 3
