June 17th Quizzes

Question 1

When owners of the corporation are also sureties of the corporation, if the corporation defaults…

Answer 1

The owners are immediately liable

Question 2

The classification of a principal as disclosed, undisclosed or partially disclosed: what does it affect?

What does it not affect?

Answer 2

Affects contractual liability of agent toward 3rd parties

Does not affect authority given the agent

Question 3

An agent representing an undisclosed principal has the same…

Answer 3

Implied authority as an agent representing a disclosed principal

Question 4

An option is unenforceable when it…

Answer 4

Lacks consideration

Question 5

Under the negotiable instruments article of the UCC, an instrument will be precluded from being negotiable if the instrument is…

Answer 5

Made subject to another agreement

Question 6

The intent, or Scienter, element necessary to establish a cause of action for fraud will be met if the plaintiff can show that the…

Answer 6

Defendant made a misrepresentation with reckless disregard for the truth

Question 7

The element necessary in establishing fraud is met by showing that the defendant had knowledge of…2

Answer 7

1 misrepresentation with intent to mislead or

2 showed reckless disregard for truth

Question 8

Which of the following collectibles are an acceptable investment for an IRA?

Answer 8

Coins and bullion

Question 9

Permanent differences between taxable income and pretax income affect…

Answer 9

Neither interperiod nor intraperiod income tax allocation

Question 10

Generally a corporation does not recognize income when…

Answer 10

Issuing its own stock

Question 11

When the FMV of stock is less than he debt it is used to pay off, the difference is considered…

Answer 11

Income from the forgiveness of debt

Question 12

If there are originally 1,000 shares of stock and a non taxable dividend gives an additional 100 shares of stock, the original basis is $25,000 for the 1,000 shares. What is the basis per share?

Answer 12

$25,000/1100

Question 13

Expenditures for research and experimentation that are exceptions to…

Answer 13

The uniform capitalization rules and are not required to be

capitalized

Question 14

Dividends received deduction is 70% of the lesser of the…2

Answer 14

1 dividend received or

2 taxable income before the DRD

Question 15

Which of the following organizations would generally qualify for exemption from federal income tax?

Answer 15

Title holding organization organized as a corporation

Question 16

The ability to transfer licensing credential from one state to another is controlled by state boards and reciprocity is not guaranteed. Individuals seeking a particular state’s licensing credential must present…

Answer 16

Authorization for release of score information

Question 17

According to the AICPA Articles of Professional Conduct, a CPA will hold themselves out as…

Answer 17

Individuals that will honor the public trust

Question 18

If the auditor performed an additional review of the audited statements to ensure that the statements were accurate as of the effective date of registration statement this would…

Answer 18

Establish the defense of due diligence under 33’ act

Question 19

For a client suing a CPA for negligence must prove…4

Answer 19

1 CPA owed legal duty
2 CPA breached duty
3 proximate cause
4 client suffered damage

Question 20

Voidable preference allows a trustee to…

Answer 20

Set aside the security interest

Question 21

Voidable preference allows a trustee to set aside the security interest which…

Answer 21

Secures payment of the obligation

Question 22

Under the Federal Bankruptcy Code, can the debtor’s trustee in bankruptcy set aside the creditor’s security interest in the debtor’s inventory?

Why?

Answer 22

Yes

Debtor giving security interest to creditor created voidable preference

Question 23

Under the Federal Fair Labor Standards Act, what is regulated in addition to minimum wage and overtime?

Answer 23

Number of hours in workweek

Question 24

Under FOB purchaser’s loading dock, which of the parties bears the risk of loss during shipment? Why?

Answer 24

Seller

Risk of loss passes only when the goods reach the purchaser’s
Loading dock

Question 25

What is an example of property that can be considered either personal property or real property?

Answer 25

Growing crops

Question 26

Air rights are considered…

Answer 26

Real property

Question 27

Mineral rights are part of…

Answer 27

Real property

Question 28

Harvested crops are considered…

Answer 28

Personal property

Question 29

Filing of a security agreement relates to…

Not…

Answer 29

Perfection

Not attachment

Question 30

In addition to debtor having rights in collateral and value being given by the creditor, what is another requirement for attachment?2

Answer 30

1 debtor signed security agreement

2 or collateral in possession of Creditor