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WGU Accounting for Decision Makers C213 VAC2 Sample Questions:

1. A company prepared the following contribution margin income statement for the actual sale of 10,000 shoes:
Sales revenue = $600,000
Variable costs = $400,000
Contribution margin = $200,000
Less fixed costs = $150,000
Net income = $50,000
What would be the forecasted net income for the sale of 14,000 shoes based on the actual results above?

A) $230,000
B) $70,000
C) $130,000
D) $40,000

2. Which role do ethical standards have in management accounting?

A) To provide the management accountant with the ability to work with only companies that follow strict ethical principles
B) To guide the resolution to possible ethical dilemmas that the managerial accountant may encounter
C) To provide the management accountant with the ability to know whether a person will act ethically or not
D) To prevent all unethical behavior of anyone the management accountant may work with

3. In September, an airline using accrual accounting received cash from a round-trip ticket sold to a customer for
$1,500. The ticket allowed the customer to fly from Denver to Hawaii in October and from Hawaii back to Denver in November.
When should the airline recognize revenue?

A) In September, October, and November
B) Only in September
C) In October and November
D) Only in November

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

5. What is true regarding the use of International Financial Reporting Standards (IFRS)?

A) IFRS are commonly required to be used in Asia
B) IFRS may be used instead of generally accepted accounting principles (GAAP) by any U.S.-based corporation
C) IFRS are required to be used by the Securities and Exchange Commission (SEC)
D) IFRS are seldom used by non-U.S. companies

Solutions: