All of the following represent an increased opportunity for management to commit fraud except:

A. the financial statements include highly subjective estimates.
B. the auditor's relationship with management is strained.
C. management is dominated by a single person.
D. significant related party transactions.


Answer: B

Business

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In the two-period model, suppose a household's income in the first period is $40,000, income in the second period is $50,000, and the real interest rate is 25 percent. The government proposes to give the household a tax rebate of $5,000 in the first period, but will tax the household an additional $5,000 × 1.25 = $6,250 in the second period. The household is ____ under the government's tax rebate plan compared with before.

A. better off B. worse off C. equally well off D. possibly better off and possibly worse off

Business

Incentives that just focus on short-term sales objectives may not motivate sales reps to develop long-term, need-satisfying relationships with their customers.

Answer the following statement true (T) or false (F)

Business

Proceeds from the issuance of new debt and principal payments upon maturity of debt used to

finance a project should be included in the calculation of the project's after-tax cash flows. Indicate whether the statement is true or false

Business

The Foreign Sovereign Immunities Act (FSIA) provides that American courts generally cannot hear suits against foreign governments. Describe the three possible exceptions to this rule.

What will be an ideal response?

Business