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WGU Accounting for Decision Makers C213 VAC2 Sample Questions:
1. 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) 4.78
B) 1.38
C) 1.47
D) 0.83
2. Which formula yields a cash times interest earned ratio of 11?
A) Cash before interest and taxes of $11,000 / cash paid for acquisitions of $1,000
B) Cash before interest and taxes of $11,000 / cash from operations of $1,000
C) Cash before interest and taxes of $11,000 / cash paid for interest of $1,000
D) Cash before interest and taxes of $11,000 / cash paid for income taxes of $1,000
3. Which information does a balance sheet provide about a company?
A) Assets and liabilities for a specific point in time
B) Revenues and expenses for a period of time
C) Cash collections and cash expenditures for a period of time
D) Cash collections and cash expenditures at a specific point in time
4. What is a significant role of the U.S. Securities and Exchange Commission (SEC) in financial reporting?
A) The SEC ensures that financial statement users are provided with reliable information to use in decision- making
B) The SEC ensures that auditors have the resources and information necessary to provide valuable professional services
C) The SEC provides representation and training to controllers of public companies
D) The SEC supports company management and boards of directors in the effective discharge of their responsibilities
5. A company has three product lines and has historically used the traditional costing system to allocate overhead costs to each product line. Due to significant differences in the production processes for the three product lines, the company implemented an activity-based costing study and identified the activity-based cost for each product, as shown in the following table.
Product A
Product B
Product C
Traditional cost per unit
$558
$1,375
$1,211
Activity-based cost per unit
$675
$1,585
$1,350
Selling price per unit
$650
$1,450
$1,300
What do these data points reveal about the selling price of this company's products?
A) The selling price for only Products A and C should increase
B) No change should be made to the selling price
C) The selling price should increase for all three products
D) The selling price for only Product B should increase
Solutions:
| Question # 1 Answer: C | Question # 2 Answer: C | Question # 3 Answer: A | Question # 4 Answer: A | Question # 5 Answer: C |
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