WGU Financial Management VBC1 : Financial-Management Exam

  • Exam Code: Financial-Management
  • Exam Name: WGU Financial Management VBC1
  • Updated: Sep 16, 2026
  • Q & A: 86 Questions and Answers

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About WGU Financial Management VBC1 : Financial-Management Exam Questions

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WGU Financial-Management Exam Syllabus Topics:

SectionObjectives
Risk and Return- Portfolio risk and diversification
- Expected return
Cost of Capital and Valuation- Weighted average cost of capital (WACC)
- Bond and stock valuation basics
Capital Budgeting- Net present value (NPV)
- Internal rate of return (IRR)
- Payback period analysis
Time Value of Money- Annuities and perpetuities
- Present and future value calculations
Financial Statement Analysis- Financial ratios
- Balance sheet and income statement interpretation
- Cash flow analysis

WGU Financial Management VBC1 Sample Questions:

Question #1

Why would a company choose to maintain a certain level of cash as a reserve balance?

  • A. To safeguard against unforeseen expenses and maintain liquidity
  • B. To cover the cost of repurchasing shares from the stock market
  • C. To pay for major capital expenditures without external financing
  • D. To distribute as dividends at the end of the fiscal year
Reveal Solution  Discussion  0

Correct Answer: A  🗳️

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Question #2

What does a beta of less than 1 signify in the capital asset pricing model (CAPM)?

  • A. The investment is risk-free.
  • B. The investment has higher risk than the market.
  • C. The investment has a return that is independent of the market.
  • D. The investment has lower risk than the market.
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Correct Answer: D  🗳️

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Question #3

Use Whole Pine Inc.'s financial statements for 20X3 below to answer the following question.
What is Whole Pine Inc.'s total asset turnover for 20X3?

  • A. 1.25
  • B. 0.50
  • C. 2.33
  • D. 2.50
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Correct Answer: A  🗳️

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Question #4

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

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Question #5

What is an advantage of using the Gordon growth model to estimate the cost of common equity?

  • A. It calculates the impact of beta on stock returns.
  • B. It incorporates future dividend growth expectations.
  • C. It measures the systematic risk of the company.
  • D. It considers historical stock performance.
Reveal Solution  Discussion  0

Correct Answer: B  🗳️

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