WGU C213 Accounting for Decision Makers

WGU C213 Accounting for Decision Makers 5.0 (1 review) Students also studied Terms in this set (54) Western Governors UniversityC 213 Save WGU C213 Accounting for Decision ...82 terms Cait_Blankenship Preview WGU C213 Final Exam Teacher 73 terms zhanleonPreview C213 65 terms Kdenman9196 Preview WGU - 55 terms Jrin What does accounting focus on?The impact a business's activities have on it's overall financial performance Which report summarizes cash collections and cash expenditures from operating, investing, and financing activities over a period of time?Statement of cash flows Which users would have a primary concern with an organization's ability to provide healthcare benefits?Employees Which benefit does a corporation gain by following Generally Accepted Accounting Principals (GAAP)?An increase in its comparability to other companies Which body regulates a certified public accounting firm's audit practices when the firm is auditing a large publicly traded company?The FASB What has had the most significant impact on accounting practices?Information Technology What two items of information are revealed on the balance sheet?Debt, Ownership Which term is defined as the residual interest in the net assets of a company?Owner's equity A corporation has total liabilities of $300 million, total owner's equity of $100 million, and current assets of $50 million. What is the value of the firm's long-term assets?$350 million

Which situation should result in revenue recognition on the income statement for the year ending 12/31/14 if the firm is using accrual-basis accounting?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?Cash flows from financing activities Where would an investor find a summary of a company's significant accounting policies?In the notes to the financial statements What does it mean if a company has a debt ratio of

101.5%?

The company has 1.5% more total liabilities that total assets Which assurances does an external audit report provide for its readers?The company's financial statements fairly reflects its financial position What is consistent with a continual decline in gross profit if the firm's cost of goods sold remains the same?Continual decrease in sales Which formula yields a cash time interest earned ratio of 11?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 category?Notes payable expected to be paid in 18 months Which two values affect the measurement of net income? Dividend paid, operating expenses Which two items subtotals are included in a multi-step income statement?gross profit, income from operations A furniture company using accrual accounting purchased 20 sofas in November 2011, In December 2011, 8 of the sofas were sold to customers. The customers all signed contracts agreeing to pay half the amount owed in February 2012 and the remaining half in March 2012. At the time of sale, the company was reasonably sure the customers would pay the amount owed.In which month should advertising costs be expended?November 2011 On May 1, 2011, a company using accural accounting purchased equipment costing $500,000. It expects the equipment to have a useful life of five years. At the time of purchase, the company also purchased a one-year insurance policy on this equipment, which cost $6,000.How much insurance expense should the company have recognized of the year ending in 2011?

$4,000

What was the 2012 net profit amount if the 2013 pro-forma net profit of $187,000 was based on a 22% increase?

$153,279

What is a common category in a statement of cash flows? Cash from investing activities Which cash flow category would include cash received from investors?Cash from financing activites Which item is an investing activity?Cash payments for purchase of plant assests What impact does the sale of equipment have on the statement of cash flows?Increase in cash from investing activities What is known about the direct and indirect methods of preparing statements of cash flow?The indirect method is more popular among large US companies Which two examples represent financial statement errors?The accounting dept. miscalculates the payroll tax due at year-end, resulting in an inaccurate liability.The accountant unintentionally records amounts as revenue that were prepaid by customers but not yet earned.Which internal control is intended to ensure that a company does not mistakenly pay a supplier for an invoice that includes more items than were actually received?The inventory department counts and inspects items as received and forwards the receiving record to accounts payable What are two common reasons for managers to manipulate reported earnings?They are preparing to qualify for a bank loan.They are feeling pressured to meet internal sales goals.Which two requirements must accounting firms that audit public companies meet under the Sarbanes-Oxley Act?Firms must report to and be retained by the audit committee rather than the CFO or other company management.Firms must help to develop and enforce a code of ethics on audit clients.Which two requirements must management of public companies under the Sarbanes-Oxley Act?They must provide an assessment of the effectiveness of internal controls with each annual report.They must support a stronger board and audit committee.Which two actions do internal auditors perform to assist in maintaining the integrity of financial statements?They review financial records and internal controls.They search for and investigate fraud.What is a significant role of the US Securities and Exchange Commission (SEC) in financial reporting?They ensure that financial users are provided with reliable information to use in decision making What does management accounting provide?The insight that management needs so the business can perform more effectively.The detailed data that managers need to make decisions that will give the business a competitive edge.How does management accounting differ from financial accounting?Management accounting is used primarily for internal planning, control, and evaluation

Which account is seen on the balance sheet of a manufacturing company but not on the balance sheet of a service-oriented company?Inventory What is a cost that will change in the future based upon the decision made?differential cost Which two examples are period costs?Administrative overhead.Selling expenses A company manufactures custom-built wooden bookshelves. Which two costs would the company classify as period costs?Advertising costs.Salary of the receptionist.What role do ethical standards have in management accounting?To guide the resolution to possible ethical dilemmas that the managerial accountant may encounter Which two costs are included when calculating inventory costs?Direct labor.Overhead.In which scenario would activity-based costing be more appropriate than traditional costing?A company produces five different products. The products are highly differentiated and have significantly different demands for their use of overhead costs Which category of ABC activities are machine setup and material movement costs associated with?Batch-level activities The director of a marathon race wants to assign the cost of having police officers along the race route to manage crowd control. Which consideration is an appropriate cost driver?The cost of liability insurance for the race.The number of participants and spectators.Which two concepts are studied in cost-volume-profit analysis?profits.levels of activity What are two impacts on costs as sales volume increases?Total fixed costs will increase in direct proportion.Fixed costs per unit will decrease.A company is experiencing an increase in bad debt expense, which change in credit policy would cause this increase?Some customers were allowed to pay their bills in 60 days versus the normal 30 days Order the step in the decision cycle1 prepare financial statements

• analyze financial statement

3Gather information

• make decisions
• implement decisions