1. Regulation of CPAs is accomplished by the AICPA through the Uniform Accountancy Act (UAA) by each of the below except? a) No state issues their own licenses. b) Attest services and compilation of financial statements are only professional services for which a license is required. c) Can still prepare and file tax returns even without a license. d) Can rely on information provided by client as long as it appears to be correct.
2. CPA’s in public practice can? a) State one fee for a certain service knowing the fee at the end of the engagement will be higher. b) Accept a contingent fee c) Disclose any confidential client information without consent d) Sign the return
3. CPA’s must do the following or face possibility of incurring penalties except? a) Must provide client with copy of return. b) Must state pros and cons of joint versus separate returns. c) Must answer all applicable questions d) Must not provide client with copy of return
4. Who can not sue involving securities trading? a) Any purchaser of a registered security b) Any third party c) Initial purchaser d) Stock Trader
5. Where client and CPA can be held liable for the full amount of an obligation even if one can not pay their share. a) Privity of contract b) Joint liability c) Severally liability d) Material fact
6. Independence of the auditor is impaired if any of the following occurs except? a) Auditor has a financial interest in the client. b) Was a trustee or executor of an estate that had a financial interest in the client of over 10%. c) Had a loan with the client, was an officer or director of the client, or owned more than 10% of the client’s capital. d) Employed by the firm or any of their immediate family who had more than a 10% interest in the client.
7. Reasonably prudent CPA should not provide or have a high level of?

a) Care b) Skills c) Knowledgeable judgment d) Supervision
8. Supervision and review of subordinates work to make sure it is performed in accordance with what is to be presented in the report and to remain skeptical throughout is the definition of? a) Competence b) Due Professional care c) Independence d) Joint liability
9. The Public Company Accounting Oversight Board (PCAOB) has certain powers like the below listed example except? a) Responsible for establishing auditing standards. b) Requires engagement quality review by a competent reviewer who was not a member of the audit team. c) Can require all nonpublic companies to register with them. d) Can inspect the audit practices.
10. The Dodd Frank Act of 2010 enacts all except? a) Requires all members of the compensation committee of public companies must be independent. b) Requires public corporations to disclose why or why not the chairman of the board is also the chief executive officer. c) Requires a nonbinding vote by shareholders on extreme pay incentives to top executives at least every three years. d) Requires rewards to not be paid to whistle blowers.
11. Responsible for maintaining the protection of investors of public companies from being misled and to maintain fairness within the markets. a) Securities and Exchange Commission (SEC) b) Sarbanes-Oxley Act c) Public Company Accounting Oversight Board (PCAOB) d) Dodd Frank Act
12. The Securities and Exchange Commission (SEC) requires all except? a) Requires public company’s internal control over financial statements to be audited. b) Requires all members of the compensation committee of public companies must be independent. c) Requires audit and non-audit fees to be disclosed by companies. d) Requires that all bookkeeping services performed will impair the CPA’s independence.
13. The Sarbanes-Oxley Act does not require? a) Retention of audit work papers for 7 years. b) Any firms with less than 100 audits per year are reviewed every 3 years. c) Audit partner in charge rotated after every 7 years. d) Can not perform most non-audit services.
14. Exempt securities (still can be subject to antifraud provisions) under the Securities Act of 1933 include all of the following except? a) Notes with a maturity of 9 months or less.

b) Non Profit organizations. c) Government organizations. d) Non-Government organizations.
15. Regulates the sales of all securities registered and initially sold. Provides a full and fair disclosure of any material information. a) Stockholder's rights b) Securities Act of 1934 c) Exempt securities d) Securities Act of 1933
16. Anyone who can have influence over the day to day operations of a company. a) Controlling person b) Person c) Underwriter d) Stock trader
17. A person or entity that backs and sells a security. a) Person b) Underwriter c) Controlling Person d) Stock Trader
18. Articles of Incorporation of a company usually include all of the following except? a) Proposed name and address b) Purpose c) Powers d) Prospective financial statements
19. Articles of Incorporation of a company usually include all of the following except? a) Name of registered agent b) Name of the proposed corporation c) Name and address of each incorporator d) Number of authorized shares
20. To incorporate, the following is required except? a) Name of the proposed corporation b) Name and address of each incorporator c) Information of any meetings the corporation will have. d) The number of shares that can be issued and the capital structure
21. The board of directors are responsible for the following except? a) Set officers’ salaries. b) Elect officers of the corporation. c) Can set the dividend rate and declare them as well. d) Can not have complete access to the corporation’s books.

22. Is where management of company puts the interest of the company ahead of their own. a) Duty of loyalty b) Business judgment rule c) Insider trading d) Shareholder's rights
23. Is anyone owning 10% or more of a single class of stock, a director, officer, or attorney for the corporation. a) Business judgment rule b) Duty of loyalty c) Insider trading d) Shareholder's rights
24. Shareholders of a corporation have certain rights like all of the following except? a) Right to inspect the books of the corporation b) Can not designate a CPA or attorney to act on their behalf. c) Preemptive rights that allow their amount of shares to not be diluted when future shares are sold. d) Entitled to dividends unless it is proven that the corporation would be insolvent if it declared dividends.
25. Stock that was issued and then bought back by the corporation but can be resold. a) Common Stock b) Preferred Stock c) Par value stock d) Treasury stock
26. Characteristics of preferred stock include all of the following except? a) Usually have no voting rights but given first priority over common stockholders if a company files for bankruptcy. b) Generally higher costs than a common stock issue. c) Dividends typically expected as they usually receive a certain pre-stated dividend amount. d) There can be more than one class of stock.
27. The number of shares that are held by outstanding by an individual or other financial institution represents what? a) Par value stock b) Treasury stock c) Authorized stock d) Issued stock
28. Management is not responsible for? a) Making any changes necessary to the financial statements. b) CEO and CFO must attest to accuracy of the financial statements. c) Is not responsible if they designate a CPA or attorney to act on their behalf. d) Providing the auditor with any information needed pertaining to the financial statements and their internal control.
29. Which of the following is not an essential of a contract?

a) Consideration b) Legality c) Offer d) Reception
30. What is required to be filed with SEC? a) Registration statement b) Prospectus c) Assignment d) Delegation
31. Which is not a type of a contract? a) Executory b) Counteroffer c) Unilateral d) Bilateral
32. What type of contract is only enforceable unless agreed upon? a) Executed b) Executory c) Voidable d) Void
33. Offer made in response to another offer. a) Offer b) Advertisements for offers c) Counteroffer d) Firm offer
34. The transfer of party’s rights to another party is what? a) Assignment b) Delegation c) Firm offer d) Counteroffer
35. The validity of a contract depends on six factors but which one of the below is not one? a) Fraud b) Agility c) Legality d) Error
36. There must be an offer and an acceptance for there to be a contract and all items of contract must be identified is requirements of? a) Breach of Contract b) Discharge of a contract c) Performance of a contract d) Contract
37. The definition of discharge of a contract is?

a) Where a party who entered a contract can be released from any obligations the contract specifies by agreement, accord and satisfaction. b) The actual performance of the duties of a contract. c) Agreement between parties to exchange something like goods or services. d) Where a person who has entered into a contract does not honor the responsibilities outlined within the contract.
38. Which of the following is not a contract that must be in writing? a) A guarantee of a debt. b) A transaction of $1,000 or more. c) Any contract taking longer than one year to meet. d) Any contract involving real estate (land).
39. The exchange of title (ownership) of something (goods) from a seller to a buyer is? a) Oral contracts b) Bill of Lading c) Transfer of Title d) Document of title
40. Where item (goods) are sold but can be returned but at the risk of the buyer. a) Sale on Return b) Sale on Approval c) Cash on Delivery (COD) d) Warranty of Title
41. A Warranty of Merchantability is? a) Where item (goods) being sold are free from any third party claims. b) Where goods will meet all standards already shown or stated. c) Where item (goods) being sold is free from any defects and the statement of “as is” is usually included. d) Where seller of item (goods) recommends certain goods to buyer and implies a warranty that they will meet buyers’ requirements.
42. Which of the following is not a type of commercial paper? a) Promissory Note b) Certificate of Deposit c) Draft d) Trade Deficit
43. Individual who issues another (drawee) to pay someone else (payee). a) Payee b) Drawee c) Drawer d) Payer
44. What listed below is not a type of collateral? a) Goods b) Indispensable paper c) Tangibles d) Intangibles

45. For a security agreement to be valid it must contain all of the below except? a) Be in writing b) Signed by the debtor c) Contain a description of the collateral d) Contain financial statements
46. If debtor is in default, the secured party has all of the listed rights except? a) Right to sell collateral debtor has put forth. b) Right to collect. c) Right to retain any collateral already within their possession. d) Right to file a claim.
47. What is the correct order of Distribution of Assets when under bankruptcy? a) Secured Creditors, unsecured claims, priority claims. b) Unsecured claims, secured creditors, priority claims. c) Priority claims, secured creditors, unsecured claims. d) Secured creditors, priority claims, unsecured claims.
48. What type of bankruptcy allows continued operations by retention of the business’s assets? a) Chapter 11 b) Chapter 7 c) Chapter 9 d) Chapter 13
49. The right to bring proceedings immediately against any debtor who is in default is a right of? a) Creditor’s rights against secondary debtor b) Creditor’s rights against principal debtor c) Creditor’s rights against guarantor of collection d) Creditor’s rights against surety
50. Agency or agents can have three kinds of authority. Which of the following is not one of those kinds of authority? a) Actual authority b) Apparent authority c) Power of attorney d) Agent’s authority
51. A Federal law that is to control air pollution and prevent humans from being exposed to contaminate. a) Clean Air act b) Clean Water Act c) Noise Control Act d) Civil Rights Act
52. Established laws overseeing child labor, overtime compensation, and minimum wage. a) Family and Medical Leave Act (FMLA) b) Clayton Act of 1914 c) National labor Relations Act (NLRA d) Federal Fair Labor Standards Act (FLSA)

53. Tax providing compensation to any employees that loses their job (employer paid). a) Equal Pay Act b) Federal Unemployment Tax Act (FUTA) c) Employee Retirement Income Security Act (ERISA) d) Federal Insurance Contributions Act (FICA)
54. CPA’s must do all of the following or face possibility of incurring penalties except? a) Must provide client with copy of return b) Must not sign the return c) Must state pros and cons of joint versus separate returns d) Must answer all applicable questions

55. Publicly traded corporations and any company having assets totaling over $10 million and having 500 or more stockholders must file all of the below except? a) 10-K b) 10-Q c) 8-K d) 6-K
56. The Securities and Exchange Commission (SEC) can a) Impose fines on CPAs b) Restrict CPA from practicing before them if a felony and/or misdemeanor involving moral turpitude were involved. c) Restrict CPA from practicing before them if there was a willful violation of federal security laws and/or regulations. d) Require any accounting firm with more than 100 publicly traded clients to be PCAOB inspected every three year.
57. Results from nondisclosure or pertinent information, errors that are not corrected, or GAAP departures. a) Negligence b) Fraud c) Misstatement d) Material Misstatement
58. Taxpayer penalties include all except? a) Accuracy related penalty is 20% of the underpayment. b) Late filing penalty is 5% of net taxes due per month. c) Late filing penalty is 10% of net taxes due per month. d) Late payment penalty is 0.5% of net taxes due per month.
59. Filing statuses include all of the below except? a) Married, filing separate b) Married, filing jointly c) Head of household d) Divorcee
60. Which of the examples of different accounting periods for different types of business operating vehicles is not correct? a) Estates – any it chooses. b) Trusts – calendar year. c) S-Corporations – usually the calendar year. d) Corporations – calendar year.
61. Depreciable Personal Property is a) Section 1120 b) Section 1250 c) Section 1245 d) Section 1240

62. Is when assets are exchanged in the middle of the year and only half of a year’s depreciation is taken in year of acquisition and in year of sale. a) Half-Year convention b) Mid-quarter convention c) Amortization d) Depletion

63. Includes anything used in a trade or business that is held for more than one year. a) Section 1245 property b) Section 1231 property c) Section 1250 property d) Section 1240 property
64. Section 1231 property is not? a) Anything held less than one year is treated as ordinary income. b) Gives them the same tax treatment as a capital gain or loss. c) Requires any gain on a basis of the property to be treated as ordinary gain/loss. d) Includes cut timber and livestock that is used in a business.
65. Which of the following is not a basis of stock received as a dividend? a) Holding period of stock received as a dividend includes holding period of old shares as well usually making it long term. b) If not included in income when received then it is allocated between dividend stock and original stock. c) If included in income when received then it is FMV at time of receivership. d) Rights were non taxable and not expired then basis is zero if FMV of rights is a 15% of FMV of stock.
66. What will not result in the initial basis of a property being adjusted. a) Improving b) Selling a portion c) Selling a fixture d) Property passed to a decedent
67. Amount paid or fair market value (FMV) of another property plus expenses to buy the property. a) Basis of property b) Cost of property c) Holding period for property d) Leasing period of a property
68. Residential lease agreements must contain the following to be legal except? a) Term of lease stated. b) List of parties who will be involved. c) States how much lease payments will be. d) Description of what leased asset is not.
69. Which of the following is not a type of lease? a) Tenancy at will b) Tenancy for a term c) Tenancy at sufferance d) Common tenancy
70. Protected marks or symbols used to distinguish a company’s products from any competition’s products. a) Contracts b) Mortgages

c) Trademarks d) Lease
71. Contracts for land sales must be in writing identifying the following except? a) Land itself and its boundaries. b) Terms and conditions of the contract. c) Purchase price. d) Conditions of the price.
72. Where two or more people have undivided interest in a property. a) Concurrent interest b) Easement c) Tenancy in common d) Joint tenancy
73. The use of someone else’s property without their permission a) Bailments b) Easement c) Tenancy in common d) Joint tenancy
74. Real property can be owned in several ways and they are all of the below except? a) Warranty deed b) Grant deed c) Quitclaim deed d) Fee simple
75. Property that is left with the owner having the intention of retrieving it but forgot. Finder does not obtain title. a) Misplaced Property b) Abandoned property c) Lost property d) Real property

76. Gross income includes everything except? a) Wages b) Salaries c) Child Support payments d) Commissions
77. Gross income excludes all of the following except? a) Unemployment compensation b) Employer provided education assistance c) Medical savings accounts d) Life insurance proceeds
78. Adjustments for AGI include each of the below except? a) College tuition and fees b) Interest on student loans c) Jury duty payments d) Scholarships used for educational costs
79. Which of the following is not a tax credit? a) Dependent care credit b) Credit for the aged and disabled c) Earned income credit d) Child care tax credit
80. Used to eliminate the double taxation of income derived from foreign countries that is taxed in those countries and then is eligible to be taxed again in the United States. a) Foreign tax credit b) AMT tax credit c) Qualified Retirement Savings Credit d) Lifetime learning credits

81. Which of the following statements is correct? a) The formation of a partnership can result in decreased taxes if the joining partner provides services for their interest b) Partnerships are taxable entities c) The holding periods for a partner’s interest in a partnership begins when the partnership’s interest is acquired d) There are recognized gains/losses on property or stock exchanged for an interest in a partnership.
82. A partner’s basis in a partnership is not. a) Increased for all income. b) Decreased for all income. c) Decrease for all distributions. d) Decreased for all deductions and losses.
83. Partnership rights do not include which of the below? a) Have right to share in profit/loss only equally b) Have right to all partnership property. c) Have right to participate in everyday management actions. d) Have right to fiduciary duty to and from other partners.
84. A partnership ceases to exist when all of the following occur except? a) They stop conducting business. b) No longer 2 or more partners. c) No longer 3 or more partners. d) When more than 50% of the partnership is sold
85. Sole Proprietorships advantages include all of the following except? a) The ease of startup and operation of business. b) Pass thru tax benefits c) No sharing of power or profits d) Must outlay all initial capital needed to operate the business.
86. Limited Liability Companies (LLC) does not offer? a) Gives all shareholders or members limited liability. b) All members can bind LLC unless otherwise stated in bylaws. c) No gains/losses are recognized by corporation if some type of property is exchanged for stock in a corporation. d) Any member’s interest in the LLC can not be transferred without consent.
87. Corporations are not? a) Domestic b) Foreign c) Alien d) Native
88. S- Corporations advantages include all of the following except? a) Provide limited liability b) More than one class of stock can be issued.

c) All family members treated as one shareholder. d) All income is taxed at the individual shareholders rate.
89. When two or more corporations are combined and form an entirely new corporation. a) Merger b) Parent c) Consolidation d) Dissolution
90. Penalty to make a corporation to not keep unnecessary cash on hand. a) Accumulated earnings credit b) Accumulated earnings tax c) Alternative minimum tax (AMT) d) Personal holding company (PHC) tax
91. Taxed at ordinary rates plus an additional 15% tax rate on undistributed PHC income to discourage people from putting back money only to avoid taxes. a) Accumulated earnings credit b) Accumulated earnings tax c) Alternative minimum tax (AMT) for corporations d) Personal holding company (PHC) corporations
92. Any other incentive added to an exchange to entice the seller to buy or the buyer to buy. a) Boot b) Estates c) Grantor (revocable) trust d) Irrevocable trust
93. Can withdraw assets at any time and any income taxed to the creator. a) Grantor (revocable) trust b) Irrevocable trust c) Estates d) Boot
94. A trust must have the following to be legal except? a) Have a beneficiary and a trustee b) Specific existence time period c) Have assets and liabilities d) Have a purpose it is to serve
95. Type of trusts do not include? a) Testamentary b) Spendthrift c) Estates d) Intervivos

11. (a)
12. (b)
13. (c)
14. (d)
15. (d)
16. (a)
17. (b)
18. (d)
19. (b)
20. (c)
21. (d)
1. (a)
2. (d)
3. (d)
4. (d)
5. (b)
6. (d)
7. (d)
8. (b)
9. (c)
10. (d)
22. (a)
23. (c)
24. (b)
25. (d)
26. (b)
27. (d)
28. (c)
29. (d)
30. (a)
31. (b)
32. (c)
33. (c)
34. (a)
35. (b)
36. (d)
37. (a)
38. (b)
39. (c)
40. (a)
41. (c)

42. (d)
43. (c)
44. (c)
45. (d)
46. (d)
47. (d)
48. (a)
49. (d)
50. (d)
51. (a)
52. (d)
53. (b)
54. (b)
55. (d)
56. (d)
57. (a)
58. (c)
59. (d)
60. (d)
61. (c)
62. (a)
63. (b)
64. (c)
65. (d)
66. (d)
67. (b)
68. (d)
69. (d)
70. (c)
71. (d)
72. (a)
73. (a)
74. (d)
75. (a)
76. (c)
77. (a)
78. (d)
79. (d)
80. (a)

81. (c)
82. (b)
83. (a)
84. (c)
85. (d)
86. (c)
87. (d)
88. (b)
89. (c)
90. (b)
91. (d)
92. (a)
93. (a)
94. (c)
95. (c)
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