-Carlos is a certified public accountant who works for a large accounting firm.
ID: 2585460 • Letter: #
Question
-Carlos is a certified public accountant who works for a large accounting firm. Since he has been certified by the state in which he practices accounting services, he is authorized to
Multiple Choice
choose whether to apply the accounting practices of Sarbanes-Oxley for a firm.
handle every firm's reports by different rules.
express, officially, an unbiased opinion about the accuracy of a firm's financial statements.
express his personal opinion in all financial matters and audit a firm's accounting practices within his state.
publicly express a biased opinion about the unethical practices carried out in a firm.
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Sigma Corp. has recently received patent rights for its new application in the software industry. On the balance sheet, the patent rights received by Sigma Corp. is a(n)
Multiple Choice
return on asset.
current asset.
fixed asset.
liquid asset.
asset turnover.
-Clara's Candles buys $500 worth of candles on credit to sell in its retail store. When Clara records this transaction, how should she list this $500?
Multiple Choice
as a cash asset
as just a liability
as just an asset
as her owners' equity
in separate accounts as both a liability and an asset
Explanation / Answer
1. C.express, officially, an unbiased opinion about the accuracy of a firm's financial statements..
Being a CPA gives carlos the right to expess an opinion on the financial statements, he can comment whether the financial statements are accurate and reported as per the applicable financial reporting framework.
2.C.Fixed asset.
Patent rights give the right to the entity to use the particular know hoe for a certain number of years.
since it is used in the revenue generating process for more than one accounting period, patents are recorded as fixed assets.
3.E. in seprate accounts as both a liability and an asset.
the stock of candles is inventory, which is classified as current asset.
as the candles are bought on credit we have accounts payable amount of $500, which is a current liability.
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