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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. Match each accounting term with its definition.
Answer options may be used more than once or not at all.
Select your answer from the pull-down list.

3. Which two item subtotals are included in a multi-step income statement?
Choose 2 answers.

A) Current liabilities
B) Income from operations
C) Gross profit
D) Total assets

4. A company plans to purchase inventory for the second half of a year as follows:
July = $100,000
August = $75,000
September = $225,000
October = $125,000
November = $250,000
December = $30,000
The company usually pays 50% of inventory purchases in the month of purchase, 35% in the following month, and 15% in the second month.
What are the forecasted October cash payments based on this information?

A) $78,750
B) $18,750
C) $152,500
D) $62,500

5. Which formula yields a cash times interest earned ratio of 11?

A) Cash before interest and taxes of $11,000 / cash from operations of $1,000
B) Cash before interest and taxes of $11,000 / cash paid for income taxes of $1,000
C) Cash before interest and taxes of $11,000 / cash paid for acquisitions of $1,000
D) Cash before interest and taxes of $11,000 / cash paid for interest of $1,000

Solutions: