WGU C214 Financial Management
OA ACTUAL EXAM WITH ACCURATE
QUESTIONS AND ANSWERS
(VERIFIED ANSWERS) | LATEST
(2026/2027) UPDATED VERSION |
100% GUARANTEED PASS
{JUST RELEASED}
1. Trading on the NYSE is executed without a specialist (i.e. a market maker).
True or False? - ANSWER ✓ False
2. Stocks and Bonds are two types of financial instruments. True or False? -
ANSWER ✓ True
3. When revenue is matched with cost of sales in an Income statement it is
called? - ANSWER ✓ Matching principle
4. Basic balance sheet equation is what? - ANSWER ✓ Equity = Assets -
Liabilities
,5. Why is the balance sheet known as the permanent statement? - ANSWER ✓
Because the other statements are reset at the end of the fiscal year.
6. How do you calculate the change in retained earnings? - ANSWER ✓ Net
income-dividends
7. Sales - Cost of Sales - other expenses = - ANSWER ✓ Operating Income or
EBiT
8. Name four accounts that are part of total assets? - ANSWER ✓ Cash, Accounts
receivable, inventory, long term assets
9. Name three accounts that are part of total liabilities? - ANSWER ✓ Bonds,
accounts payable and mortgage
10. Name four accounts that are part of current assets? - ANSWER ✓ Inventory,
cash, accounts receivable and short term investments.
11. Name three accounts that are only included in cash flow from financing? -
ANSWER ✓ Common stock, dividends paid and bonds payable
, 12. Define the statement of cash flows? - ANSWER ✓ Calculated for the same
period of time as the incomes statement is calculated based on the income
statement and changes in the balance sheet is one of the three basic
accounting statements.
13. When fixed assets increase what happens to cash? - ANSWER ✓ Cash will
decrease
14. What is the purpose of the statement of cash flows? - ANSWER ✓ Explains the
change in cash over the course of the specified time frame.
15. Suppose the inventory turnover of a company is higher than the industry.
Based on this observation, which of the following is most likely? - ANSWER ✓
The firm has too little inventory resulting in lost sales or stock-outs.
16. If a company wishes to obtain a bank loan, will it want to have a higher
current ratio or a lower current ratio? - ANSWER ✓ Higher
17. The Operating Income Return on Investment (OIROI) uses what elements on
the income statement? - ANSWER ✓ EBIT and total assets
18. Why would a company be interested in the Total Asset Turnover (TAT) ratio? -
ANSWER ✓ To see how efficient are at producing sales
OA ACTUAL EXAM WITH ACCURATE
QUESTIONS AND ANSWERS
(VERIFIED ANSWERS) | LATEST
(2026/2027) UPDATED VERSION |
100% GUARANTEED PASS
{JUST RELEASED}
1. Trading on the NYSE is executed without a specialist (i.e. a market maker).
True or False? - ANSWER ✓ False
2. Stocks and Bonds are two types of financial instruments. True or False? -
ANSWER ✓ True
3. When revenue is matched with cost of sales in an Income statement it is
called? - ANSWER ✓ Matching principle
4. Basic balance sheet equation is what? - ANSWER ✓ Equity = Assets -
Liabilities
,5. Why is the balance sheet known as the permanent statement? - ANSWER ✓
Because the other statements are reset at the end of the fiscal year.
6. How do you calculate the change in retained earnings? - ANSWER ✓ Net
income-dividends
7. Sales - Cost of Sales - other expenses = - ANSWER ✓ Operating Income or
EBiT
8. Name four accounts that are part of total assets? - ANSWER ✓ Cash, Accounts
receivable, inventory, long term assets
9. Name three accounts that are part of total liabilities? - ANSWER ✓ Bonds,
accounts payable and mortgage
10. Name four accounts that are part of current assets? - ANSWER ✓ Inventory,
cash, accounts receivable and short term investments.
11. Name three accounts that are only included in cash flow from financing? -
ANSWER ✓ Common stock, dividends paid and bonds payable
, 12. Define the statement of cash flows? - ANSWER ✓ Calculated for the same
period of time as the incomes statement is calculated based on the income
statement and changes in the balance sheet is one of the three basic
accounting statements.
13. When fixed assets increase what happens to cash? - ANSWER ✓ Cash will
decrease
14. What is the purpose of the statement of cash flows? - ANSWER ✓ Explains the
change in cash over the course of the specified time frame.
15. Suppose the inventory turnover of a company is higher than the industry.
Based on this observation, which of the following is most likely? - ANSWER ✓
The firm has too little inventory resulting in lost sales or stock-outs.
16. If a company wishes to obtain a bank loan, will it want to have a higher
current ratio or a lower current ratio? - ANSWER ✓ Higher
17. The Operating Income Return on Investment (OIROI) uses what elements on
the income statement? - ANSWER ✓ EBIT and total assets
18. Why would a company be interested in the Total Asset Turnover (TAT) ratio? -
ANSWER ✓ To see how efficient are at producing sales
