WGU C213 PA Exam 69 Questions with Verified
Answers
The impact a business's activities have on its overall financial performance -
CORRECT ANSWER What does accounting focus on?
Statement of cash flows - CORRECT ANSWER Which report summarizes cash
collections and cash expenditures from operating, investing, and financing
activities over a period of time?
Employees - CORRECT ANSWER Which users would have a primary concern with
an organization's ability to provide healthcare benefits?
An increase in its comparability to other companies - CORRECT ANSWER Which
benefit does a corporation gain by following Generally Accepted Accounting
Principles (GAAP)?
The Internal Revenue Service (IRS) - CORRECT ANSWER Which body regulates a
certified public accounting firm's audit practices when the firm is auditing a large
publicly traded company?
Information technology - CORRECT ANSWER What has had the most significant
impact on accounting practices?
Ownership and Debt - CORRECT ANSWER What two items of information are
revealed on the balance sheet?
,Owners' equity - CORRECT ANSWER Which term is defined as the residual interest
in the net assets of a company?
$350 million - CORRECT ANSWER A corporation has 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?
In 2014, a company provides services to a customer for which cash will be
collected the next year (2015). - CORRECT ANSWER 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?
Cash flows from financing activities - CORRECT ANSWER Which category on the
statement of cash flows summarizes cash receipts and payments to owners and
creditors of the company?
In the notes to financial statements - CORRECT ANSWER Where would an investor
find a summary of a company's significant accounting policies?
The company's financial statements fairly reflect its financial position - CORRECT
ANSWER Which assurance does an external audit report provide for its readers?
Reliable-Information that can be verified
Relevant-Information having to do with the matter at hand
Material-Information that is important enough to make a difference
, Conservatism-Information related to recognizing losses as they occur - CORRECT
ANSWER Match each accounting term with its definition.
1- Prepare financial statements
2- Analyze financial statements
3- Gather information
4- Make decision
5- Implement decision - CORRECT ANSWER Order the steps in the decision cycle
from first (1) to last (5)
11 - CORRECT ANSWER Partial financial information for a company is as follows:
Current assets$36,543Total assets$58,719Current liabilities$24,824Total
liabilities$48,561Stockholders' equity$10,158Sales$46,997Net Income$
3,761Market value of shares$41,316
What is the price-earnings (PE) ratio for this company?
The company has 1.5% more total liabilities than total assets. - CORRECT ANSWER
What does it mean if a company has a debt ratio of 101.5%?
Continual decrease in sales - CORRECT ANSWER What is consistent with a
continual decline in gross profit if the firm's cost of goods sold remains the same?
$6,991 / $5,486
$5,220 / $1,875 - CORRECT ANSWER Which two cash flow adequacy ratios
represent a cash cow?
Answers
The impact a business's activities have on its overall financial performance -
CORRECT ANSWER What does accounting focus on?
Statement of cash flows - CORRECT ANSWER Which report summarizes cash
collections and cash expenditures from operating, investing, and financing
activities over a period of time?
Employees - CORRECT ANSWER Which users would have a primary concern with
an organization's ability to provide healthcare benefits?
An increase in its comparability to other companies - CORRECT ANSWER Which
benefit does a corporation gain by following Generally Accepted Accounting
Principles (GAAP)?
The Internal Revenue Service (IRS) - CORRECT ANSWER Which body regulates a
certified public accounting firm's audit practices when the firm is auditing a large
publicly traded company?
Information technology - CORRECT ANSWER What has had the most significant
impact on accounting practices?
Ownership and Debt - CORRECT ANSWER What two items of information are
revealed on the balance sheet?
,Owners' equity - CORRECT ANSWER Which term is defined as the residual interest
in the net assets of a company?
$350 million - CORRECT ANSWER A corporation has 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?
In 2014, a company provides services to a customer for which cash will be
collected the next year (2015). - CORRECT ANSWER 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?
Cash flows from financing activities - CORRECT ANSWER Which category on the
statement of cash flows summarizes cash receipts and payments to owners and
creditors of the company?
In the notes to financial statements - CORRECT ANSWER Where would an investor
find a summary of a company's significant accounting policies?
The company's financial statements fairly reflect its financial position - CORRECT
ANSWER Which assurance does an external audit report provide for its readers?
Reliable-Information that can be verified
Relevant-Information having to do with the matter at hand
Material-Information that is important enough to make a difference
, Conservatism-Information related to recognizing losses as they occur - CORRECT
ANSWER Match each accounting term with its definition.
1- Prepare financial statements
2- Analyze financial statements
3- Gather information
4- Make decision
5- Implement decision - CORRECT ANSWER Order the steps in the decision cycle
from first (1) to last (5)
11 - CORRECT ANSWER Partial financial information for a company is as follows:
Current assets$36,543Total assets$58,719Current liabilities$24,824Total
liabilities$48,561Stockholders' equity$10,158Sales$46,997Net Income$
3,761Market value of shares$41,316
What is the price-earnings (PE) ratio for this company?
The company has 1.5% more total liabilities than total assets. - CORRECT ANSWER
What does it mean if a company has a debt ratio of 101.5%?
Continual decrease in sales - CORRECT ANSWER What is consistent with a
continual decline in gross profit if the firm's cost of goods sold remains the same?
$6,991 / $5,486
$5,220 / $1,875 - CORRECT ANSWER Which two cash flow adequacy ratios
represent a cash cow?
