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WGU Financial-Management Exam Syllabus Topics:

SectionObjectives
Topic 1: Time Value of Money- Present and Future Value
  • 1. Present Value of a Lump Sum
  • 2. Future Value of a Lump Sum
  • 3. Annuities (Ordinary and Due)
- Bond and Stock Valuation
  • 1. Valuation of Common Stock
  • 2. Valuation of Preferred Stock
  • 3. Valuation of Bonds
Topic 2: Financial Statement Analysis- Ratio Analysis
  • 1. Market Value Ratios
  • 2. Asset Management Ratios
  • 3. Profitability Ratios
  • 4. Liquidity Ratios
  • 5. Debt Management Ratios
- Financial Statement Basics
  • 1. Income Statement
  • 2. Statement of Cash Flows
  • 3. Balance Sheet
Topic 3: Financial Management Concepts- Financial Environment
  • 1. Agency Problem and Corporate Governance
  • 2. Forms of Business Organization
  • 3. Objectives of the Financial Manager
- Financial Markets and Institutions
  • 1. Financial Institutions
  • 2. Financial Markets
  • 3. Interest Rate Levels
Topic 4: Cost of Capital and Capital Structure- Leverage and Capital Structure
  • 1. Financial Leverage
  • 2. Operating Leverage
  • 3. Optimal Capital Structure
- Cost of Capital
  • 1. Cost of Equity (CAPM, DCF)
  • 2. Weighted Average Cost of Capital (WACC)
  • 3. Cost of Debt
Topic 5: Capital Budgeting- Cash Flow Estimation
  • 1. Incremental Cash Flows
  • 2. Depreciation Methods
- Decision Criteria
  • 1. Net Present Value (NPV)
  • 2. Modified IRR (MIRR)
  • 3. Internal Rate of Return (IRR)
  • 4. Payback Period
Topic 6: Working Capital Management- Current Liabilities Management
  • 1. Short-term Financing
  • 2. Trade Credit
- Current Asset Management
  • 1. Receivables Management
  • 2. Cash Management
  • 3. Inventory Management

WGU Financial Management VBC1 Sample Questions:

During the last year, Kretsmatt had the following cash flows:
* The firm had sales of $20,000 and net income of $5,000. Dividends of $1,000 were paid, and there were no changes to working capital accounts.
* The company purchased new equipment for $3,000. There were no sales of equipment and no depreciation expense recorded during the year.
* The company raised no funds through external financing and repaid no debt.
How much were Kretsmatt's net cash flows from financing for the year?

  • A. The firm's net cash flows from financing were an inflow of $4,000.
  • B. The firm's net cash flows from financing were an outflow of $3,000.
  • C. The firm's net cash flows from financing were an inflow of $5,000.
  • D. The firm's net cash flows from financing were an outflow of $1,000.
Answer: D

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Ratios for Freedom Rock Bicycles are shown below, along with industry average ratios.

What are appropriate recommendations for Freedom Rock Bicycles based on this analysis?

  • A. To focus solely on increasing gross margins to match industry levels
  • B. To maintain current operating expenses and reduce asset levels to be in line with the industry
  • C. To reduce non-production expenses and evaluate the company's fixed costs
  • D. To increase production expenses and invest in more assets
Answer: C

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What is a benefit of a firm extending credit to customers in a competitive market?

  • A. Immediate cash inflows from sales
  • B. Increased sales to non-cash buyers
  • C. Decreased sales due to increased prices
  • D. Reduced customer base due to credit terms
Answer: B

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What is the Securities and Exchange Commission's (SEC's) Electronic Data Gathering, Analysis, and Retrieval (EDGAR) system used for?

  • A. Regulating the Federal Reserve
  • B. Insuring deposit accounts
  • C. Electronic trading of securities
  • D. Online filing and retrieval of company filings
Answer: D

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What is a limitation of historical mean returns when estimating the cost of common equity?

  • A. They require prediction of future dividends.
  • B. They are difficult to calculate.
  • C. They ignore market conditions and future prospects.
  • D. They apply only to large, established companies.
Answer: C

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