Section I: Multiple Choice Questions

 

1. Which of the following is NOT a key element of the definition of ethics?

1. Reflective choice
2. Moral principles
3. Definitive conclusions
4. Consequences of decisions

Answer: C

LO: B-01 Ethics

Topic: Ethics

Source: Original

Difficulty: 1 Easy

Bloom’s:  Remember

AACSB:  Ethics

AICPA BB:  Legal

AICPA FN:  Research

 

1. Which of the following defines the imperative principle of ethics?

1. Ethic decisions cannot be resolved without evaluating all possible outcomes of all choices.
2. Ethics are a function of moral rules and principles.
3. All ethical decisions will have positive and negative consequences
4. It is essential that decisions be made for the greater good of society.

Answer: B

LO: B-02 Philosophical Principles

Topic:

Source: Original

Difficulty: 2 Medium

Bloom’s:  Remember

AACSB:  Ethics

AICPA BB:  Legal

AICPA FN:  Research

 

1. Which of the following philosophical principles in ethics places emphasis on the consequences of action, rather than on following the rules?

1. Imperative principle.
2. Utilitarianism principle.
3. Generalization principle.
4. Moral principle.

Answer: B

LO: B-02 Philosophical Principals

Topic: Philosophical Principals

Source: Original

Difficulty: 1 Easy

Bloom’s:  Remember

AACSB:  Ethics

AICPA BB:  Legal

AICPA FN:  Research

 

1. What agency has the ultimate authority in defining independence for public companies?

1. The AICPA
2. The SEC
3. The Department of Justice
4. The U.S. Congress

Answer: B

LO: B-03 Governing Bodies

Topic: Governing Bodies

Source: Original

Difficulty: 1 Easy

Bloom’s:  Remember

AACSB:  Ethics

AICPA BB:  Legal

AICPA FN:  Research

 

1. Which of the following is the responsibility of the Professional Ethics Executive Committee?

1. Enforce SEC ethical standards
2. Act as an investigative body of the AICPA when ethical violations are suspected.
3. Make and enforce all the rules of conduct for CPAs who are AICPA members.
4. Establish minimal ethical standards for financial reporting.

Answer: C

LO: B-03 Governing Bodies

Topic: Governing Bodies

Source: Original

Difficulty: 1 Easy

Bloom’s:  Remember

AACSB:  Ethics

AICPA BB:  Legal

AICPA FN:  Research

 

1. Which of the following is NOT one of the AICPA Principles of Professional Conduct?

1. Responsibilities
2. Reliability
3. Objectivity
4. Due Care

Answer: B

LO: B-05 Rules of Conduct

Topic: Rules of Conduct

Source: Original

Difficulty: 2 Medium

Bloom’s:  Remember

AACSB:  Ethics

AICPA BB:  Legal

AICPA FN:  Research

 

1. Dara & Co. audit Hill Corporation.   Ellie is the engagement partner on the audit with an office in Buffalo Grove.  Which of the following would NOT be considered a covered member?

1. Jason, who is a member of the attest engagement team with an office in Elmhurst.
2. Adam, who is a tax partner and provided 50 hours of tax service to Hill Company during the year of the audit with an office in Elmhurst.
3. Ben, a partner in Dara & Company, with an office in Buffalo Grove.
4. Julie, a partner in Dara & Company, with an office in Elmhurst.

Answer: D

LO: B-04 Independence

Topic: Independence

Source: Original

Difficulty: 2 Medium

Bloom’s:  Application

AACSB:  Ethics

AICPA BB:  Legal

AICPA FN:  Research