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WGU Accounting for Decision Makers C213 VAC2 Sample Questions:

1. A company manufactures and sells widgets. The following information is available:
* Total fixed costs per month are $300,000
* The variable cost per widget is $50
* Each widget sells for $100
How many widgets does the company need to sell each month to break even?

A) 6,000
B) 4,500
C) 2,000
D) 3,000

2. Which technique describes the practice of incurring debt but fully paying the debt over time?

A) Income smoothing
B) Profit control
C) Accounting management
D) Liability deferral

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

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

4. Which body regulates a certified public accounting firm's audit practices when the firm is auditing a large, publicly traded company?

A) The Financial Accounting Standards Advisory Council (FASAC)
B) The Financial Accounting Standards Board (FASB)
C) The Internal Revenue Service (IRS)
D) The Public Company Accounting Oversight Board (PCAOB)

5. A company collects 20% of the credit sales in the month of sale and the rest is collected equally in the following two months. The company made the following credit sales:
January = $500,000
February = $420,000
March = $545,000
April = $550,000
May = $555,000
June = $567,000
July = $600,000
Which is the correct amount of cash collection in the month of September?

A) $624,000
B) $670,000
C) $658,000
D) $625,000

Solutions: