2009 Aicpa Newly Released Question - Business

Only available on StudyMode
  • Download(s) : 177
  • Published : November 15, 2012
Open Document
Text Preview
2009 AICPA Newly Released Questions – Business

Following are multiple choice questions recently released by the AICPA. These questions were released by the AICPA with letter answers only. Our editorial board is currently working on providing detailed explanations for these questions, so please check back to the Becker Knowledgebase soon for the updated file. Please note that the AICPA generally releases questions that it does NOT intend to use again. These questions and content may or may not be representative of questions you may see on any upcoming exams.

1

2009 AICPA Newly Released Questions – Business

1. CPAA company's target gross margin is 40% of the selling price of a product that costs $89 per unit. The product's selling price should be: a. b. c. d. $124.60 $142.40 $148.33 $222.50

Explanation Choice "c" is correct.

2

2009 AICPA Newly Released Questions – Business

2. CPAWren Co. manufactures and sells two products with selling prices and variable costs as follows: A $18.00 12.00 B $22.00 14.00

Selling price Variable costs

Wren's total annual fixed costs are $38,400. Wren sells four units of A for every unit of B. If operating income last year was $28,800, what was the number of units Wren sold? a. b. c. d. 5,486 6,000 9,600 10,500

Explanation Choice "d" is correct.

3

2009 AICPA Newly Released Questions – Business

3. CPAWhich form of business entity has the following attributes? I. Limited liability for all its owners. II. Can permit all its owners to participate in management and control of the entity. III. Absent an agreement to the contrary, is dissolved on the death, withdrawal, or bankruptcy of an owner. a. b. c. d. A limited partnership. A limited liability company. A general partnership. A corporation.

Explanation Choice "b" is correct.

4

2009 AICPA Newly Released Questions – Business

4. CPAJoint ventures are most similar to which of the following types of business organizations? a. b. c. d. Limited partnerships. General partnerships. Business trusts. Subchapter S corporations.

Explanation Choice "b" is correct.

5

2009 AICPA Newly Released Questions – Business

5. CPAWhich of the following statements best states the purpose of cumulative voting? a. b. c. d. To assure the continuance of incumbent directors. To allow minority shareholders to gain representation on the board of directors. To allow for the election of one-third of the board of directors each year. To assure that a majority of shares voted elects the entire board of directors.

Explanation Choice "b" is correct.

6

2009 AICPA Newly Released Questions – Business

6. CPAWhich of the following forms of business generally provides all owners with limited liability while avoiding federal taxation of income at the entity level? a. b. c. d. Subchapter C corporation. Subchapter S corporation. Partnership. Limited partnership.

Explanation Choice "b" is correct.

7

2009 AICPA Newly Released Questions – Business

7. CPAUnder the Revised Model Business Corporation Act, which of the following dividends is not defined as a distribution? a. b. c. d. Cash dividends. Property dividends. Liquidating dividends. Stock dividends.

Explanation Choice "d" is correct.

8

2009 AICPA Newly Released Questions – Business

8. CPAWhich of the following rates is most commonly compared to the internal rate of return to evaluate whether to make an investment? a. b. c. d. Short-term rate on U.S. Treasury bonds. Prime rate of interest. Weighted-average cost of capital. Long-term rate on U.S. Treasury bonds.

Explanation Choice "c" is correct.

9

2009 AICPA Newly Released Questions – Business

9. CPAWhat is the most likely effect if a court pierces the corporate veil? a. b. c. d. The corporation's shareholders, officers, and directors can be assigned liability. The corporation can be held liable for acts of the directors. The corporation can lose its tax exempt status. The...
tracking img