Discuss the conflict between advocacy for a client and responsibility to the IRS.
What will be an ideal response?
The CPA's primary duty is to his or her client, not the IRS. The CPA should provide quality advice based on sound legal authority. CPAs do not have to verify client data unless it appears inconsistent, erroneous, or incomplete. CPAs also are not required to report most potential tax law violations to the IRS. If a client refuses to correct a tax-related error, the CPA may terminate the relationship.
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The unit of measure in Japan is the U.S. dollar
a. True b. False Indicate whether the statement is true or false
The numerator in the formula for equivalent units includes all beginning inventory costs when using the weighted average costing assumption
Indicate whether the statement is true or false
A steel manufacturer experienced a decrease in its fixed asset turnover from .9 in Year 5 to .7 in Year 6 . This change is consistent with which of the following explanations?
a. The firm sold a fully-depreciated factory on January 1, Year 6 that had been closed in Year 4 and held for sale since then. b. The steel industry operated at capacity during Year 6, permitting all firms to raise selling prices. c. The firm recognized an impairment loss on a factory that became obsolete during Year 6 because of new environmental regulations. d. The firm decreased the number of units produced and sold because of an inability to obtain needed raw materials. e. none of the above
Product A has a sales price of $10 per unit. Based on a 10,000-unit production level, the variable costs are $6 per unit and the fixed costs are $3 per unit. Using a flexible budget for 12,500 units, what is the budgeted operating income from Product A?
A. $12,500. B. $30,000. C. $25,000. D. $20,000. E. $35,000.