WGU D354 Accounting fundamentals exam questions with answers

Father of accounting and bookkeeping?

Galileo Galilei

Niccolo Machiavelli

Leonardo da Vinci

Luca Pacioli (Correct)

Why was the Public Company Accounting Oversight Board (PCAOB) created?

To promote investment in small businesses

To establish international tax regulations

To oversee mergers and acquisitions

To address major cases of corporate fraud (Correct)

Primary benefit of a properly designed internal control system?

It eliminates all risks of financial loss.

It guarantees profitability for the company.

It reduces the risk of financial loss but does not eliminate it. (Correct)

It completely prevents errors and fraud from occurring.

Which type of accounting prepares statements for external users?

Financial accounting (Correct)

Auditing

Tax accounting

Managerial accounting

Managerial accounting useful for automation decision?

Following GAAPs to ensure external reporting consistency

Analyzing historical production costs to identify trends and inefficiencies (Correct)

Preparing standardized financial reports for audit purposes

Summarizing past financial performance for stakeholders

Managerial accounting focuses on which data?

Data required by tax authorities

Data relevant to regulatory filings

Data aggregated for external stakeholders

Data that aids in future planning and decision‑making (Correct)

Managerial accounting reports include which information?

Compliance and regulatory data for external reporting

Market trends unrelated to operations

Historical financial info for external stakeholders

Monetary and nonmonetary information (Correct)

Why was the Sarbanes‑Oxley Act enacted?

To create global accounting standards

To reduce financial reporting requirements

To provide tax relief for fraud

To improve the accuracy and reliability of financial reporting in public companies (Correct)

Purpose of an external audit?

To ensure financial information is reliable for external stakeholders (Correct)

To identify areas to reduce expenses

To ensure compliance with tax regulations

To assess management performance

Regulation violated if CEO/CFO approve misstated financial statements?

Sarbanes‑Oxley Act (Correct)

Securities Act of 1933

Federal Trade Commission Act

Internal Revenue Code

AICPA Code of Conduct violation example?

Internal auditor testing transactions

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