If a CPA and non-CPA form a partnership to practice public accounting, which of the following arrangements would be permitted or required by the AICPA for such a partnership? I. A non-CPA banker who will be an owner will not be actively engaged in the practice. The banker is providing the financing to get the partnership formed and operating. II. Non-CPA owners (other than the banker) who are actively engaged as members of the firm would have to complete the same number of work-related CPE requirements as the CPA members. III. Non-CPA owners could have the title "partner." IV. None of these partnerships are permitted or required by the AICPA. I only II and III O Ill only OIV only

If a CPA and non-CPA form a partnership to practice public accounting, which of the following arrangements would be permitted or required by the AICPA for such a partnership? I. A non-CPA banker who will be an owner will not be actively engaged in the practice. The banker is providing the financing to get the partnership formed and operating. II. Non-CPA owners (other than the banker) who are actively engaged as members of the firm would have to complete the same number of work-related CPE requirements as the CPA members. III. Non-CPA owners could have the title "partner." IV. None of these partnerships are permitted or required by the AICPA. I only II and III O Ill only OIV only

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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What are the unique financial reporting implications of the Partnership entity in comparison with the Proprietorship and Corporate structures? How does the closing process differ for the Partnership?
Which of the following statements is most true? a. The liability for other partners’ wrong doings is limited to the amount a particular partner has invested in the partnership. b. Partnerships are formed in accordance with specific guidelines that include the filing of a formal written agreement to the government. c. A fast growing firm would be more probable to establish a partnership as its business form than would a slow growing firm. d.Corporations can easier attract investors than those of the partnership and sole proprietor businesses.
Assess the truth of this statement: The transaction of a partnership that is recording cash invested by a partner should be recorded as a debit to cash and a credit to the individual partner's drawing account. O This statement is true. O This statement is false. O There is not enough information to determine whether or not this statement is true. O This statement is not applicable to accounting concepts.
As a professional accountant, Lisa works for an accounting firm that provides advisory services to various clients. In a particular transaction, Lisa finds herself representing more than one client, which creates a conflict of interest situation. Lisa's accounting firm is engaged to provide financial advisory services for two clients: Company A and Company B. These companies are involved in a potential merger transaction, and both have sought assistance from Lisa's firm. However, Lisa realizes that the interests of Company A and Company B may not align completely, leading to a conflict of interest. a) What actions should Lisa take to effectively manage the conflict of interest situation that arises when representing both Company A and Company B in their potential merger transaction?
A BDO audit client subject to SEC independence rules make financial reporting software. The audit client wants BDO to become a reseller of their software. The terms would be the same as those offered to any other reseller. The relationship would be immaterial to both BDO and the client. Is this permitted under SEC rules? Yes, because it is immaterial to both parties. No, because reseller arrangements are business relationships and the SEC does not permit the audit firm to have a business relationship with an audit client. Yes, because BDO is not the only reseller and would be offered the same terms as any other reseller.
Assess the truth of this statement: The normal balance of a partner's capital account is a credit balance. Group of answer choices This statement is true. This statement is false. There is not enough information to determine whether or not this statement is true. This statement is not applicable to accounting concepts.
Which of the following acts by a CPA would be most likely to be a violation of the AICPA Code of Professional Conduct? Select one: A “covered member” owns an immaterial amount of stock in an audit client. Accepting a fee in a tax matter that is contingent upon the result of an administrative proceeding. Assisting a client in preparing a financial forecast. Forming a professional corporation to practice as a CPA.
According to the Code of Professional Conduct of the AICPA, for which type of service may a CPA receive a contingent fee? O Performing an audit of a financial statement. O Performing a review of a financial statement. O Performing an examination of a prospective financial statement. O Seeking a private letter ruling.
Select the best answer. Which of the following statements regarding various entities is true? O O O A. A business entity with only one owner is classified as a corporation or is disregarded. ion Q 10 B. A disadvantage of a pass-through entity is double taxation. C. By default, an eligible entity that has a single member will be treated as a limited partnership. Partnerships are taxpaying entities, because tax attributes pass through to the individual partners. O D. Submit Answers 100% Complete Exit
Even though, from an accounting standpoint, partnerships are separate entities from the partners, why is it important for people to form partnerships with people they can trust?
Assess the truth of this statement: One of the rules of debits and credits and account balances for a partnership is that assets increase as debits. Group of answer choices This statement is true. This statement is false. There is not enough information to determine whether or not this statement is true. This statement is not applicable to accounting concepts.
Following the American Institute of Certified Public Accountants (AICPA) code of professional conduct A is required only by members of the AICPA.B is voluntary by members and nonmembers.C is required only in situations that do not jeopardize personal interest.D mandatory for all CPAs.