WGU C213 Final Exam: ACCOUNTING FOR DECISION

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WGU C213 Final Exam: ACCOUNTING FOR DECISION

MAKERS Questions and Answers (2023/2024) Verified Score A+

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• What does accounting focus on(answer) The impact a business's activities have on its overall financial performance • Which report summarizes cash collections and cash expenditures from operating, investing, and financing activities over a period of time(answer) State- ment of cash flows • Which users would have a primary concern with an organization's ability to provide healthcare benefits(answer) Employees • Which body regulates a certified public accounting firm's audit practices when the firm is auditing a large publicly traded company(answer) The Public Com- pany Accounting Oversight Board (PCAOB) • What has had the most significant impact on accounting practices(answer) Infor- mation technology • What two items of information are revealed on the balance sheet?

Choose 2 answers:

Ownership. Debt • Which term is defined as the residual interest in the net assets of a company(answer) Owners' equity 2 / 4

• A corporation has total liabilities of $300 million, total owners' equity of $100 million, and current assets of $50 million.What is the value of the firm's long-term assets(answer) $350 million • Which situation should result in revenue recognition on the income state- ment for the year ending 12/31/14 if the firm is using accrual-basis account- ing(answer) In 2014, a company provides services to a customer for which cash will be collected the next year (2015).• Which category on the statement of cash flows summarizes cash receipts and payments to owners and creditors of the company(answer) Cash flows from financing activities • Where would an investor find a summary of a company's significant accounting policies(answer) In the notes to financial statements • Which assurance does an external audit report provide for its readers?-

: The company's financial statements fairly reflect its financial position

• Reliable: Information that can be verified

• Relevant: Information having to do with the matter at hand

• Material: Information that is important enough to make a difference

• Conservatism: Information related to recognizing losses as they occur 3 / 4

• steps in the decision cycle: 1 Prepare financial statements. 2 Analyze financial statements.

• Gather information. 4

Make decision.

• Implement decision

• Partial financial information for a company is as

follows: Current assets $36,543

Total assets $58,719 Current liabilities $24,824 Total liabilities

$48,561

Stockholders' equity $10,158 Sales $46,997 Net Income $ 3,761 Market value of shares $41,316 What is the price-earnings (PE) ratio for this company(answer) 11.0 • What is consistent with a continual decline in gross profit if the firm's cost of goods sold remains the same(answer) Continual decrease in sales • Which two cash flow adequacy ratios represent a cash cow(answer)

$6,991/$5,486. $5,220/$1,875.

• Which formula yields a cash times interest earned ratio of 11(answer) Cash before interest and taxes of $11,000 / cash paid for interest of $1,000 • Which form of debt should be reported in the long-term liability catego- ry(answer) Notes payable expected to be paid in 18 months

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