ACC 544 help A Guide to career/uophelp.com ACC 544 help A Guide to career/uophelp.com | Page 5

• Question 11 Alex Stone, CPA, prepared Ray Pym’s 2012 federal
income tax return. Pym advised Stone that he had paid doctors’ bills of
$15,000 during 2012, when in fact Pym had paid only $3,000 of bills.
Based on Pym’s representations, Stone properly computed the medical
expense deduction, with consequent understatement of tax liability of
more than $5,000. Pym’s total tax liability shown on the return was
$40,000. Stone had no reason to doubt the accuracy of Pym’s figures,
although Stone did not request documentation for the expenses claimed;
but he was assured by Pym that sufficient corroborative evidence of
these expenses existed. In connection with Stone’s preparation of Pym’s
2012 return, Stone is
• Question 12 The Ultramares decision is a leading case that helps define
when a CPA is liable to different parties. If a CPA has committed
negligence, under this decision the CPA is liable to which of the
following parties?
• Question 13 Clark, a professional tax return preparer, prepared and
signed a client’s 2012 federal income tax return that resulted in a $600
refund. Which one of the following statements is correct with regard to
an Internal Revenue Code penalty Clark may be subject to for endorsing
and cashing the client’s refund check?
• Question 14 Jay, CPA, gave an unqualified opinion on Nast Power
Co.’s financial statements. Larkin bought Nast bonds in a public
offering subject to the Securities Act of 1933. The registration statement
filed with the SEC included Nast’s financial statements. Larkin sued Jay
for misstatements contained in the financial statements under the
provisions of Section 11 of the Securities Act of 1933. To prevail,
Larkin must prove
• Question 15 The Joint Ethics Enforcement Program involves joint
enforcement of the ethics rules of
------------------------------------------------------------------------------------
ACC 544 Quiz 3