Strayer ACC403 midterm exam 2015

User
Course Auditing I
Test Midterm Exam
Part 1
Started2/9/15 12:10 AM
Submitted 2/9/15
1:29 AM
Status Completed
Attempt Score 125 out
of 125 points
Time Elapsed 1
hour, 18 minutes out of 2 hours.
Instructions This
midterm exam consists of 25 multiple choice questions and covers the material
in Chapters 1 through 4.
• Question
1
5 out of 5 points

The three requirements for
becoming a CPA include all but which of the following?

• Question
2
5 out of 5 points

In “auditing” financial
accounting data, the primary concern is with:
Answer

• Question
3
5 out of 5 points

Three common types of attestation
services are:

• Question
4
5 out of 5 points

________ risk reflects the
possibility that the information upon which the business decision was made was
inaccurate.
Answer

• Question
5
5 out of 5 points

Recording, classifying, and
summarizing economic events in a logical manner for the purpose of providing
financial information for decision making is commonly called:
Answer

• Question
6
5 out of 5 points

A correct relationship among the
auditor, the client, and the external users is:
Answer

• Question
7
5 out of 5 points

Standards issued by the Public
Company Accounting Oversight Board must be followed by CPAs who audit:
Answer

• Question
8
5 out of 5 points

In order to properly plan and
perform an audit, an important fact for both the auditor and the client to
understand is that:
Answer

• Question
9
5 out of 5 points

Assume the Public Company
Accounting Oversight Board (PCAOB) identifies a violation during its inspection
of a registered accounting firm. The PCAOB:
Answer

• Question
10
5 out of 5 points

Which of the following are audit
standards used in professional practice by audit firms?
Answer

• Question
11
5 out of 5 points

The purpose of establishing
quality control policies and procedures to accept or continue a client
relationship is to:
Answer
• Question
12
5 out of 5 points

For privately held companies who
is responsible for establishing auditing standards?
• Question
13
5 out of 5 points

When a qualified or adverse
opinion is issued, the qualifying paragraph is inserted:
Answer
• Question
14
5 out of 5 points

When there is uncertainty about a
company’s ability to continue as a going concern, the auditor’s concern is the
possibility that the client may not be able to continue its operations or meet
its obligations for a “reasonable period of time.” For this purpose,
a reasonable period of time is considered not to exceed:

• Question
15
5 out of 5 points

After the auditor determines
whether any conditions exist which require a departure from a standard
unqualified report, the next step in the decision process for audit reports is
to:
Answer

• Question
16
5 out of 5 points

The audit report date on a
standard unqualified report indicates:
Answer

• Question
17
5 out of 5 points

A CPA may wish to emphasize
specific matters regarding the financial statements even though an unqualified
opinion will be issued. Normally, such explanatory information is:
Answer

• Question
18
5 out of 5 points

If most or all users’ decisions
that are based on the financial statements are likely to be significantly
affected, the materiality level is:
Answer

• Question
19
5 out of 5 points

Which of the following represents
all of the ways a CPA firm can be organized under Rule 505?
Answer

• Question
20
5 out of 5 points

When a member observes the
profession’s technical and ethical standards and strives to continually improve
her competence and quality of services, she is exercising:
Answer
• Question
21
5 out of 5 points

The financial interests of a
CPA’s family members can affect the CPA’s independence. Which of the following
parties would not be included as a “direct financial interest” of the
CPA?
• Question
22
5 out of 5 points

Rule 301 of the AICPA’s Code of
Professional Conduct requires CPAs to maintain the confidentiality of client
information. This rule would be violated if a CPA disclosed information without
a client’s consent as a result of a:

• Question
23
5 out of 5 points

The AICPA’s Code of Professional
Conduct states that a CPA should maintain integrity and objectivity. The term
“objectivity” in the Code refers to a CPA’s ability to:
Answer

• Question
24
5 out of 5 points

The members of a client’s
“audit committee” should be:
Answer

• Question
25
5 out of 5 points

Which of the following services
are allowed by the SEC whenever a CPA also audits the company?
Answer

MIDTERM part II

Test Midterm Exam
Part 2
Started2/9/15 1:30 AM
Submitted 2/9/15
1:47 AM
Status Completed
Attempt Score 120 out
of 125 points
Time Elapsed 17
minutes out of 2 hours.
Instructions This
midterm exam consists of 25 multiple choice questions and covers the material
in Chapters 5 through 8.
• Question
1
5 out of 5 points

The laws that have been developed
through court decisions are called:
Answer
Selected
Answer:
• Question
2
5 out of 5 points

Laws that have been passed by the
U.S. Congress and other governmental units are:
Answer

• Question
3
5 out of 5 points

The Foreign Corrupt Practices Act
(FCPA) of 1977:
Answer
Selected
Answer:

• Question
4
5 out of 5 points

Which of the following most
accurately describes fraud?
Answer
Selected
Answer:

• Question
5
0 out of 5 points

The expectation gap:
Answer
Selected
Answer:

• Question
6
5 out of 5 points

Recklessness in the case of an
audit is present if the auditor knew an adequate audit was not done but still
issued an opinion, even though there was no intent to deceive financial
statement users. This description is the legal term for:
Answer
Selected
Answer:
• Question
7
5 out of 5 points

In certifying their annual
financial statements, the CEO and CFO of a public company certify that the
financial statements comply with the requirements of:
Answer

• Question
8
5 out of 5 points

The auditor’s best defense when
material misstatements are not uncovered is to have conducted the audit:
Answer
• Question
9
5 out of 5 points

If a short-term note payable is
included in the accounts payable balance on the financial statement, there is a
violation of the:
Answer

• Question
10
5 out of 5 points

The essence of the attest
function is to:
Answer

• Question
11
5 out of 5 points

Management assertions are:
Answer

• Question
12
5 out of 5 points

Tests of details of balances are
specific audit procedures that are intended to:
Answer

• Question
13
5 out of 5 points

Physical examination:
Answer
• Question
14
5 out of 5 points

When practical and reasonable,
U.S. auditing standards require the confirmation of:
Answer
• Question
15
5 out of 5 points

When the auditor develops
supporting evidence for amounts posted to account balances with documentary
evidence, that process is called:
Answer

• Question
16
5 out of 5 points

________ is the auditor’s
examination of the client’s documents and records to substantiate that the
information is included in the financial statements.
Answer

• Question
17
5 out of 5 points

Which of the following is not one
of the four decisions about what evidence to gather and how much of it to
accumulate?

• Question
18
5 out of 5 points

The two characteristics of the
appropriateness of evidence are:
Answer
• Question
19
5 out of 5 points

An example of an external
document that provides reliable information for the auditor is:
Answer
• Question
20
5 out of 5 points

Smith, CPA has requested
permission to communicate with the predecessor auditor in order to review
certain workpapers for high risk accounts for a new audit client. The new audit
client’s refusal to allow this communication to occur would impact Rodgers
decision concerning:
Answer
• Question
21
5 out of 5 points

Which of the following normally
signs the engagement letter for an audit of a private company?
Answer

• Question
22
5 out of 5 points

The purpose of an engagement
letter is to:
Answer
Selected
Answer:

• Question
23
5 out of 5 points

A measure of the auditor’s
assessment of the likelihood that there are material misstatements in an
account before considering the effectiveness of the client’s internal control
is called:
Answer
Selected
Answer:

• Question
24
5 out of 5 points

In making client acceptance
decisions, the audit firm will consider:
Answer
• Question
25
5 out of 5 points

Related party:
Answer