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WGU Accounting for Decision Makers C213 VAC2 Sample Questions:

1. A company has projected the following sales for the spring quarter of a year:
April = $300,000
May = $325,000
June = $375,000
Cash is used to pay for 65% of all sales. The remainder is on credit.
The pattern for credit receivables collections is as follows:
* Month of sale = 60%
* Month after sale = 30%
* Second month after sale = 10%
What are the projected cash sales for all three months of the spring quarter?

A) $350,000
B) $195,000
C) $105,000
D) $650,000

2. Which two items increase net income?
Choose 2 answers.

A) Interest income
B) Income tax expense
C) Cost of sales
D) Gain on sale of assets

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

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

4. How are activity-based costing systems different from traditional costing systems?

A) Activity-based costing systems are used with homogeneous products while traditional costing systems are used with heterogeneous products
B) Activity-based costing systems require less time and expense to administer than traditional costing systems
C) Activity-based costing systems are based on a single cost driver and traditional costing systems are based on multiple cost drivers
D) Activity-based costing systems provide a more precise assignment of overhead costs when multiple products are manufactured than traditional costing systems do

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

Solutions: