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WGU D102 Questions And Answers With Verified Solution

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WGU D102

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Western Governor\\\'S University

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wgu d102
wgu d102 questions and answers with verified solut
wgu d102 questions and answers
what information is contained in a balance sheet

Institution Western Governor'S University
Course WGU D102

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WGU D102 Questions And Answers With Verified
Solution
What information is contained in a balance sheet?
Report of a company's financial position as of a point in time.
What is an owner's equity?
Loans payable
Accounts receivable
Capital stock
Cash
Capital stock
A company ended July assets of $150,000 and owners equity of $60,000.

What is the amount of liabilities at the end of July?
$90,000
What is reported in a multiple-step income statement that is not reported in a single-step income
statement?
gross profit

How is gross profit computed?
Sales minus cost of goods sold
The following are some accounts from a company's financial statement

Accounts receivable
Cost of goods sold
Cash
Retained earnings
Sales
Inventory
Income tax expense
Accounts payable

Which set is a list of all of the items that are used in computing this company's net income?
Sales, cost of goods sold, income tax payable
What cash flow category contains activities whereby cash is obtained from or repaid to owners or
creditors?
financing

,Here are some financial statement items for the year for a company.
Cash received from customers
Cash received from the sale of land
Cash paid for dividends
Cash paid to employees for wages
Cash paid to purchase a new building
Cash paid for rent
Cash received as new investment from owners
Which set of items is a list of items that are used in computing the company's financing cash flow for the
year?
Cash paid for dividends and cash received as new investment from owners.
Here are some financial statement items for a company.
Net income
Cash flow from financing activities
Cash balance at the beginning of the year
Sales Cash flow from investing activities
Accounts receivable
Retained earnings at the beginning of the year
Cash flow from operating activities
What items are used in computing the company's ending cash balance for the year?
Cash balance at the beginning of the year, cash flow from operating activities, cash flow from investing
activities, and cash flow from financing activities.
How is revenue typically recorded with debits and credits?
As a credit, representing an increase in equity.
What is the proper way to record an increase in an asset account and an increase in an equity account?
Asset, debit; equity, credit

A company was started last year when the shareholders invested $70,000 cash into it. At that time, the
company also borrowed $100,000 cash from a local bank. The company used $140,000 cash to purchase
inventory for $140,000. This year the company sold all of the inventory for $95,000 cash (and that is not a
typographical error; the amount received for all of the inventory was only $95,000 cash).
Which account balance is correct with respect to this company's balance sheet after the sale of the
inventory?
Total owners' equity is $25,000.
On January 1, a company had these assets, liabilities, and equities:
Cash$100
Inventory$140
Accounts payable$70
Paid-in capital$150
Retained earnings$20
During the year, the company entered into these transactions:

, Selling inventory costing $140 for a total of $200; cash of $30 was received, and the remaining $170 was
put on account.
Paying cash for rent of $45.
Paying cash dividends of $30.
What is this company's total equity at the end of the year?
$155
A company made a $3,000 cash payment on a loan. Of the $3,000 cash paid, $2,400 was for interest
expense and $600 was a payment to reduce the loan balance.
What is included in the journal entry necessary to record this loan payment?
Debit to interest expense for $2,400.
A company was started last year when the shareholders invested $70 cash into the company. At that time,
the organization also borrowed $30 cash from a local bank. The organization used $80 cash to purchase
inventory for $80. This year the company sold all of the inventory for $55 cash. (That is not a
typographical error; the amount received for all of the inventory was only $55 cash.)
Assuming that there is no interest on the loan, what is true with respect to this company's balance sheet
after the sale of the inventory?
Total owners' equity is $45.
How are expenses typically recorded with debits and credits?
As a debit, representing a reduction in equity.
A company purchased inventory for $5,000. The company paid $1,000 cash and the remainder of the
purchase was made on account.
What is included in the journal entry necessary to record this inventory purchase?
Credit to accounts payable for $4,000.
A company sold inventory that cost $1,300 for $2,000. It received $500 cash and the remainder was on
account.
What is included in the journal entry or entries necessary to record this sale of inventory?
Debit to accounts receivable for $1,500.
On August 1 of Year 1, a company paid $7,200 for two years' rent. The rental period starts on August 1 of
Year 1.
Which debit or credit is correctly included in the adjusting journal entry necessary on December 31 of
Year 1?
Debit to rent expense for $1,500.
The revenue recognition principle states that revenues are recorded when two main criteria have been
met. One of those criteria is that cash has been collected or collectability is reasonably assured.
What is the other criterion?
The earnings process is substantially complete.
What is the matching principle?

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