WGU D103 Pre-Assessment: Latest 2024
Intermediate Accounting I Units 5-7 Actual Exam
Questions with 100% Correct Answers | Rated A+
According to the revenue recognition principle, at which point should revenue be
recognized? - Correct Answer - When the performance obligation is satisfied
What are the enhancing qualities of accounting information? - Correct Answer -
Comparability, Verifiability, Timeliness, and Understandability
Which organization enforces appropriate accounting practices for publicly traded
companies? - Correct Answer - SEC
Which ingredient supports faithful representation? - Correct Answer - Completeness
Deferrals - Correct Answer - prepaid expenses and unearned revenues
accruals - Correct Answer - accrued revenues and accrued expenses
an adjusting entry for prepaid expenses - Correct Answer - debit expenses, credit
assets
an adjusting entry for unearned revenues - Correct Answer - debit liability, credit
revenue
deferrals understate or overstate net income? - Correct Answer - understate
Which basic objective is associated with the conceptual framework for financial
reporting? - Correct Answer - Decision-Usefulness
pg. 1
, What entity requires that members prepare financial statements in accordance with
GAAP? - Correct Answer - AICPA's Code of Professional Conduct
What is addressed in Rule 203 of the Code of Professional Conduct? - Correct Answer -
Financial statements being based on generally accepted accounting principles
What organization provides implementation guidance within the framework of the
Codification to reduce diversity in practice on a timely basis? - Correct Answer - AAA
(American Accounting Association)
The "why"-purpose of accounting - Correct Answer - Objective of financial reporting
What is the current cash debt coverage often used to assess? - Correct Answer -
Liquidity- Liquidity refers to the "nearness to cash" of assets and liabilities - how quickly
can they get and use their cash
Cash debt coverage - Correct Answer - net cash provided by operating
activities/average total liabilities
Operating Activities - Correct Answer - involve the cash effects of transactions that enter
into the determination of net income
Financing Activities - Correct Answer - involve liability and owners' equity items. They
include (a) obtaining resources from owners and providing them with a return on their
investment, and (b) borrowing money from creditors and repaying the amounts
borrowed.
Investing Activities - Correct Answer - include making and collecting loans and acquiring
and disposing of investments (both debt and equity) and property, plant, and equipment.
In which section of a statement of cash flows should you report proceeds from issuing
equity instruments? - Correct Answer - Financing activity
pg. 2
Intermediate Accounting I Units 5-7 Actual Exam
Questions with 100% Correct Answers | Rated A+
According to the revenue recognition principle, at which point should revenue be
recognized? - Correct Answer - When the performance obligation is satisfied
What are the enhancing qualities of accounting information? - Correct Answer -
Comparability, Verifiability, Timeliness, and Understandability
Which organization enforces appropriate accounting practices for publicly traded
companies? - Correct Answer - SEC
Which ingredient supports faithful representation? - Correct Answer - Completeness
Deferrals - Correct Answer - prepaid expenses and unearned revenues
accruals - Correct Answer - accrued revenues and accrued expenses
an adjusting entry for prepaid expenses - Correct Answer - debit expenses, credit
assets
an adjusting entry for unearned revenues - Correct Answer - debit liability, credit
revenue
deferrals understate or overstate net income? - Correct Answer - understate
Which basic objective is associated with the conceptual framework for financial
reporting? - Correct Answer - Decision-Usefulness
pg. 1
, What entity requires that members prepare financial statements in accordance with
GAAP? - Correct Answer - AICPA's Code of Professional Conduct
What is addressed in Rule 203 of the Code of Professional Conduct? - Correct Answer -
Financial statements being based on generally accepted accounting principles
What organization provides implementation guidance within the framework of the
Codification to reduce diversity in practice on a timely basis? - Correct Answer - AAA
(American Accounting Association)
The "why"-purpose of accounting - Correct Answer - Objective of financial reporting
What is the current cash debt coverage often used to assess? - Correct Answer -
Liquidity- Liquidity refers to the "nearness to cash" of assets and liabilities - how quickly
can they get and use their cash
Cash debt coverage - Correct Answer - net cash provided by operating
activities/average total liabilities
Operating Activities - Correct Answer - involve the cash effects of transactions that enter
into the determination of net income
Financing Activities - Correct Answer - involve liability and owners' equity items. They
include (a) obtaining resources from owners and providing them with a return on their
investment, and (b) borrowing money from creditors and repaying the amounts
borrowed.
Investing Activities - Correct Answer - include making and collecting loans and acquiring
and disposing of investments (both debt and equity) and property, plant, and equipment.
In which section of a statement of cash flows should you report proceeds from issuing
equity instruments? - Correct Answer - Financing activity
pg. 2
