WGU D102 Pre-Assessment-Solved 2023

What information is contained in a balance sheet? - ANSWER-Report of a company's financial position as of a point in time. What is an owners' equity item? - ANSWER-Capital stock A company ended July with assets of $150,000 and owner's equity of $60,000. What is the amount of liabilities at the end of July? - ANSWER-$90,000 What is reported in a multiple-step income statement that is not reported in a single-step income statement? - ANSWER-Gross profit How is gross profit computed? - ANSWER-Sales minus cost of goods sold. The following are some accounts from a company's financial statements: 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? - ANSWER-Sales, cost of goods sold, and income tax expense. What cash flow category contains activities whereby cash is obtained from or repaid to owners or creditors? - ANSWER-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? - ANSWER-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? - ANSWER-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? - ANSWER-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? - ANSWER-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? - ANSWER-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? - ANSWER-$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? - ANSWER-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.)