WGU C213 Final Exam Accounting for Decision Makers Questions and Answers (2022/2023) (Verified Answers)

C213 Final Accounting Exam

2022/2023

1.Which of the following activities would internal auditors NOT

typically perform in a large company?: Detect fraud

Evaluate internal controls

*Prepare the primary financial

statements Assist with increasing the

efficiency of operation

2. Correct Answer:

$3,800 Beginning cash

balance:

x + $309,800 - $118,000 - $190,000 = $5,600

x = $3,800: The following financial information is available for the

year 2012: Operating activities

$ 309,800

Investing

activities

($118,000)

Financing

activities

($190,000)

Ending cash balance

$ 5,600

Given this information, what is the beginning cash balance?

3.Net Income: What is typically viewed as the fundamental measure of

a compa- ny's profitability, but there are also a variety of other

measures of "income." The best measure of sustainable profitability is

income from continuing operations.

4.What are the three primary categories of an Income Statement?: The

pri- mary categories of income statement items are revenues,

expenses, gains, and losses.

5.Income from continuing operations and extraordinary items: Income

state- ment items that do not relate to a company's continuing

operations are income from what?

6.Multi-step Income Statement: When revenue and expense items are

arranged to highlight important profit relationships, the resulting

income statement format is called a?

7.The Matching Concept: Revenue should be recognized when value

has been delivered to customers which is typically only after the

required work has been performed and after the collection of cash is

reasonably assured. What method is used to decide when to recognize

expenses?

8. Assets = Liabilities + Paid-in Capital + (Revenues - Expenses -

Dividends)-

: Individual transactions impacting income can be analyzed using the

expanded accounting equation, which is:

9.Forecast income for future periods.: What is an important use of an

income statement? It requires an understanding of what underlying

factors determine the level of a revenue or an expense.

10.Accrual Accounting: What is the process that accountants use in

adjusting raw transaction data into refined measures of a firm's

economic performance?

11.Financial Capital Maintenance: A concept that states that income

exists when the dollar amount of a company's net assets (assets -

liabilities, or owners' equity) increases during the year, after excluding

the effects of new owner invest- ment or payment of dividends to

owners. What is this approach called?

12.Gross Profit: What equals sales revenues minus the cost of goods

sold. This is the money you take in from selling goods and how much

those good cost you to make.

13.Net Profit: What is equal to gross profit minus fixed costs. Start

with gross profit and subtract fixed costs (rent, salaries, taxes,

utilities, fees, amortization, depreciation

14.Gross profit is an important number. If a company is not generating

enough from the sale of a product or service to cover the costs directly

associated with that product or service, that company will not be able to

stay in that line of business for long.: Why is Gross Profit an important

number?

15.Operating Income: What measures the performance of the

fundamental busi- ness operations conducted by a company and is

computed as gross profit minus operating expenses?

16.Operating income tells users how well a business is performing in the

activities unique to that business, separate from the financing and

income tax management policies that are handled at the corporate

headquarters level.: What does Operating Income tell a business?

17.Provides interested parties with information that can be used to

predict how a company will perform in the future.: What is a key purpose

of financial accounting?

18.Income from Continuing Operations: What is a desired income

number that reflects the aspects of a company's performance that is

expected to continue into the future?