The Sarbanes-Oxley Act (SOX) ________. A) requires independent accountants to take responsibility for the accuracy and completeness of the financial reports B) created the SEC C) ensures that financial scandals will no longer occur D) requires companies to take responsibility for the accuracy and completeness of their financial reports ANSWER D
The Sarbanes-Oxley Act (SOX) requires companies to review internal control and take responsibility for the accuracy and completeness of their financial reports. Indicate whether the statement is true or false ANSWER TRUE
Which of the following organizations requires publicly owned companies to be audited by independent accountants (CPAs)? A) Securities and Exchange Commission (SEC) B) Public Company Accounting Oversight Board (PCAOB) C) Financial Accounting Standards Board (FASB) D) American Institute of Certified Public Accountants (AICPA) ANSWER A
An examination of a company’s financial statements and records is called an audit. Indicate whether the statement is true or false ANSWER TRUE
The left side of the accounting equation measures the amount that the business owes to creditors and to the stockholders. Indicate whether the statement is true or false ANSWER FALSE
The Public Company Accounting Oversight Board (PCAOB) was created ________. A) by the Sarbanes-Oxley Act (SOX) B) to perform audits of public companies C) to make restitution to investors who were defrauded by the issuance of fraudulent financial reports D) to require auditors to take responsibility for the accuracy and completeness of financial reports ANSWER […]
The total amount of assets a business possesses may or may not be equal to the total of liabilities and equity of the business. Indicate whether the statement is true or false ANSWER FALSE
Corporations pay their own income tax on corporate income. Stockholders pay personal income tax on the dividends received from corporations. This is an example of ________. A) double taxation B) continuous life C) no mutual agency D) a limited liability company ANSWER A
Under the going concern principle, accountants must provide proof that the business will remain in operations long enough to use existing resources for their intended purpose. Indicate whether the statement is true or false ANSWER FALSE .Accountants base going concern on assumptions. Actual proof is not needed to make this determination.
David has decided to open an auto-detailing business. He will pick up an automobile from the client, take it to his parents’ garage, detail it, and return it to the client If he does all of the work himself and takes no legal steps to form a special organization, which type of business organization, in […]
