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WGU D196
WGU D196 | Exam Guide| (NEW 2025/ 2026) | Objective
Assessment Principles of Financial & Managerial
Accounting| Qs & As| Grade A| 100% Correct
What are the three main functions of accounting? - ANS ✓The 3 main functions of
accounting are: Analyzing, Bookkeeping, and Evaluating(ABE).
The Financial Accounting Standards Board(FASB) - ANS ✓An organization responsible
for studying accounting issues and establishing standards
a) Private group
b) Public process
c) Establishes GAAP
The Governmental Accounting Standards Board(GASB) - ANS ✓A private, non
governmental organization who sets accounting and financial reporting standards for
state and local governments
Securities and Exchange Commission(SEC) - ANS ✓Regulates stock exchanges
a) Has legal authority to regulate financial markets and accounting
WGU D196
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WGU D196
b) Usually defers to the FASB on accounting matters
The Public Company Accounting Oversight Board(PCAOB) - ANS ✓Oversees all
accounting firms.
Internal Revenue Service(IRS) - ANS ✓Collects and regulates income taxes
International Accounting Standards Board(IASB) - ANS ✓The FASB of the world(except
the USA)
Assets - ANS ✓assets are what we OWN.
Common Assets:
-) Cash
-) Accounts receivable
-) Inventory
-) Buildings
-) Prepaid
Liabilities - ANS ✓An obligation to pay cash, transfer other assets, or provide services to
someone.
WGU D196
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WGU D196
A) Liabilities are what we OWE.
B) Common Liabilities:
-) Accounts Payable
-) Taxes Payable
-) Mortgage Payable
-) Unearned Revenue
Owners Equity - ANS ✓The owners share of earnings.
A) Sources of equity:
-) Capital/Common Stock
-) Retained Earnings
What is the Accounting Cycle and how does it work? - ANS ✓The accounting cycle is the
procedure for analyzing, recording, summarizing, and preparing the transactions of a
business. The accounting cycle works by turning transactions into financial statements
through these steps:
Step 1: Analyze Transactions
Step 2: Record the effects of transactions
Step 3: Summarize the effects
Step 4: Prepare reports
WGU D196
WGU D196
WGU D196 | Exam Guide| (NEW 2025/ 2026) | Objective
Assessment Principles of Financial & Managerial
Accounting| Qs & As| Grade A| 100% Correct
What are the three main functions of accounting? - ANS ✓The 3 main functions of
accounting are: Analyzing, Bookkeeping, and Evaluating(ABE).
The Financial Accounting Standards Board(FASB) - ANS ✓An organization responsible
for studying accounting issues and establishing standards
a) Private group
b) Public process
c) Establishes GAAP
The Governmental Accounting Standards Board(GASB) - ANS ✓A private, non
governmental organization who sets accounting and financial reporting standards for
state and local governments
Securities and Exchange Commission(SEC) - ANS ✓Regulates stock exchanges
a) Has legal authority to regulate financial markets and accounting
WGU D196
, 2
WGU D196
b) Usually defers to the FASB on accounting matters
The Public Company Accounting Oversight Board(PCAOB) - ANS ✓Oversees all
accounting firms.
Internal Revenue Service(IRS) - ANS ✓Collects and regulates income taxes
International Accounting Standards Board(IASB) - ANS ✓The FASB of the world(except
the USA)
Assets - ANS ✓assets are what we OWN.
Common Assets:
-) Cash
-) Accounts receivable
-) Inventory
-) Buildings
-) Prepaid
Liabilities - ANS ✓An obligation to pay cash, transfer other assets, or provide services to
someone.
WGU D196
, 3
WGU D196
A) Liabilities are what we OWE.
B) Common Liabilities:
-) Accounts Payable
-) Taxes Payable
-) Mortgage Payable
-) Unearned Revenue
Owners Equity - ANS ✓The owners share of earnings.
A) Sources of equity:
-) Capital/Common Stock
-) Retained Earnings
What is the Accounting Cycle and how does it work? - ANS ✓The accounting cycle is the
procedure for analyzing, recording, summarizing, and preparing the transactions of a
business. The accounting cycle works by turning transactions into financial statements
through these steps:
Step 1: Analyze Transactions
Step 2: Record the effects of transactions
Step 3: Summarize the effects
Step 4: Prepare reports
WGU D196
