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WGU Accounting for Decision Makers C213 VAC2 Sample Questions:

1. Which balance sheet category reflects what a company owns that can be turned into cash or used to generate cash?

A) Revenues
B) Assets
C) Liabilities
D) Owners' equity

2. Which costs are found in a manufacturing company rather than a service-oriented company?

A) Indirect labor costs
B) Direct labor costs
C) Selling costs
D) Raw materials costs

3. The following list provides partial financial information for a company.
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 equity = $41,316
What is the current ratio for this company?

A) 1.47
B) 0.83
C) 1.38
D) 4.78

4. The following list provides partial financial information for a company.
Financial Category | 20X3 | 20X2
Net income | $3,540 | ?
Cash from operations | $4,417 | ?
Cash paid for capital expenditures | $5,613 | ?
Cash paid for acquisitions | $5,964 | ?
Cash paid for interest | $2,782 | ?
Cash paid for income taxes | $2,860 | ?
What is the cash flow to net income ratio for this company in 20X2?

A) 1.80
B) 2.45
C) -0.01
D) 1.35

5. What can be determined when a firm performs an external audit of a company's financial statements?

A) Whether a company's financial statements fairly reflect its financial position
B) Whether a company's financial statements indicate it made a profit
C) Whether a company's financial statements were prepared by a trained bookkeeper
D) Whether a company's financial statements indicate that the company has to pay income taxes

Solutions: