Business & Finance Chapter 6 If an accounting firm is sued for negligently preparing

subject Type Homework Help
subject Pages 9
subject Words 3118
subject Authors Al H. Ringleb, Frances L. Edwards, Roger E. Meiners

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282. If an accounting firm is sued for negligently preparing a faulty financial report for a company, it is likely that the
accounting firm is:
a. not liable; a reasonable number of mistakes are expected to occur
b. liable if the mistake is one that an ordinary person (any person off the street) would have not made
c. held subject to a special statutory standard of care
d. held to have violated the principles of strict liability
e. none of the other choices
283. An accounting firm was sued for negligently preparing a financial report for a company. It causes losses to occur.
At trial, the firm was found to have been negligent in its work. This meant that the firm would likely be:
a. responsible for losses suffered by its client that could be linked to reliance on the work
b. responsible for losses suffered by its client that could be linked to reliance on that work and to the firm
whose books were audited since that firm's reputation was damaged
c. responsible for losses not to exceed $1 million, the statutory limit on accountant liability in that state
d. not responsible for damages despite negligence, since reliance could not be shown
e. not responsible for damages despite negligence because of a lack of proximate cause
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284. An accounting firm was sued for negligently preparing a financial report for a company. It causes losses to occur
and the firm was found to have been negligent in its work. This meant that the firm would likely be:
a. not liable for damages since the problem was negligence, not intentional mistakes
b. responsible for losses not to exceed $1 million, the statutory limit on accountant liability in that state
c. not responsible for damages despite negligence, since reliance could not be shown
d. not responsible for damages despite negligence because of a lack of proximate cause
e. none of the other choices
285. Alicia, talking on her cell phone, foolishly runs off the road and over Eduardo's foot. The tort that Eduardo will most
likely initiate is:
a. battery
b. assault
c. negligence
d. emotional distress
e. none, since Alicia's action was innocent
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286. In one case, a man who was drunk wanted to recover money another man owed him. He pulled a gun and, in the
course of a struggle, accidentally shot the man who owed the money. The man who was shot sued for battery. A
court is likely to hold that the man with the gun:
a. did not commit a tort because he was drunk when the shooting happened, so did not have the necessary state
of mind
b. did not commit battery because the shooting was an accident; he only intended to threaten the man, which
may be assault, but he did not intend to shoot him
c. committed the tort of battery because he intended to invade Nelson's well-being
d. acted in self-defense once the struggle began, so was not responsible for the accidental shooting
e. none of the other choices
287. Steve has a disorder that causes him to pass out randomly. While driving one day, he passes out, is in an accident,
and injures Juan.
a. The black-out is an "act of God," so there is no liability
b. Steve is probably liable due to negligence
c. Steve is probably liable due to contributory negligence
d. Steve is probably liable due to strict liability
e. Juan is probably liable for being in Steve's way
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288. Steve has a disorder that causes him to pass out randomly. While driving one day, he passes out, is in an accident,
and injures Juan.
a. The black-out is an "act of God," so there is no liability
b. Steve is probably liable due to contributory negligence
c. Steve is probably liable due to strict liability
d. Juan is probably liable for being in Steve's way
e. none of the other choices
289. Joyce Water, Certified Public Accountant (CPA), is sued for negligent preparation of an income tax return. To
determine if she was negligent, the court applies a standard of reasonableness which measures Joyce's conduct
against that of:
a. the I.R.S. Commissioner
b. the average person
c. the typical member of Congress
d. a competent C.P.A.
e. all of the other choices
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290. A man was injured while riding a mechanical bull owned by an independent contractor at a state fair. He paid to
ride the bull and signed a form that he understood the risk of injury. After he was injured, he sued the fair that
provided the ride for negligence. You would expect the court held that:
a. the fair was not liable because it did not own the ride; but the owner of the ride could be found liable in strict
liability because it knew of the dangers
b. the fair was not liable because it did not own the ride; but the owner of the ride could be found liable in
negligence because it knew of the dangers
c. the fair and the owner of the ride could both be liable in negligence
d. the fair was liable in negligence because it had the primary responsibility to its patrons not to provide
dangerous amusements in a negligent manner
e. none of the other choices
291. A man was injured while riding a mechanical bull owned by an independent contractor at a state fair. He paid to
ride the bull and signed a form that he understood the risk of injury. After he was injured, he sued the fair that
provided the ride for negligence. You would expect the court held that:
a. the fair was not liable because it did not own the ride; but the owner of the ride could be found liable in strict
liability because it knew of the dangers
b. the fair was not liable because it did not own the ride; but the owner of the ride could be found liable in
negligence because it knew of the dangers
c. the fair and the owner of the ride could both be liable in negligence
d. the fair was liable in negligence because it had the primary responsibility to its patrons not to provide
dangerous amusements in a negligent manner
e. the man assumed the dangers voluntarily so could not sue for the injuries he suffered
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292. Driving down the street you stupidly run a red light and hit a car legally going through a green light. You knock that
car into a parked car, which knocks a loaded gun out of the parked car that falls on the street and fires a bullet that
hits a person walking on the sidewalk. That person sues you in tort for damages. They will probably:
a. win because you were negligent and caused their injury
b. win because strict liability would apply to your actions
c. win because carrying a loaded gun is dangerous
d. lose because there is no proximate cause
e. lose because traffic violations may not be the basis for tort actions
293. Driving down the street you stupidly run a red light and hit a car legally going through a green light. You knock that
car into a parked car, which knocks a loaded gun out of the parked car that falls on the street and fires a bullet that
hits a person walking on the sidewalk. That person sues you in tort for damages. They will probably:
a. win because you were negligent and caused their injury
b. win because strict liability would apply to your actions
c. win because carrying a loaded gun is dangerous
d. lose because traffic violations may not be the basis for tort actions
e. none of the other choices
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294. Kyla negligently starts a fire in a back of her restaurant. Lou is a customer at the restaurant. When he sees the
flames filling the kitchen area, he rushes back to the kitchen to help put them out and to help get the kitchen staff
out of harm's way. In the process Lou suffers some serious burn. If he sues Kyla, Kyla will:
a. win because she didn't ask Lou to help her
b. win because Lou was an intermeddler
c. lose because danger invites rescue
d. lose based on strict liability
e. lose because this was an intentional tort
295. You see someone stealing the highly prized hubcaps off your car. You have the right to protect your property by
using:
a. deadly force "in case of res judicata"
b. "all force necessary" to subdue the thief
c. force reasonable under the circumstances, which may include killing the thief
d. force reasonable under the circumstances, which would not include shooting the thief
e. force reasonable under the circumstances, which would include shooting the thief if you were concerned that
the thief could be armed
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296. You see someone stealing the highly prized hubcaps off your car. You have the right to protect your property by
using:
a. deadly force "in case of res judicata"
b. "all force necessary" to subdue the thief
c. force reasonable under the circumstances, which may include killing the thief
d. force reasonable under the circumstances, which would include shooting the thief if you were concerned that
the thief could be armed
e. none of the other choices
297. Jemal is playing basketball at a school's outdoor court. Kevin asks if he can join the game. Jemal agrees. After
playing for 15 minutes, Kevin is knocked to the ground. His wrist breaks when he hits the concrete. If Kevin sues
Jemal for his injury, a court will probably find:
a. Jemal guilty of carelessness
b. Jemal committed a negligence tort
c. Jemal not responsible due to Kevin's assumption of risk
d. Jemal strictly liable for Kevin's harms
e. Jemal's acts where the cause-in-harm of Kevin's injuries
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298. Jemal is playing basketball at a school's outdoor court. Kevin asks if he can join the game. Jemal agrees. After
playing for 15 minutes, Kevin is knocked to the ground. His wrist breaks. If Kevin sues Jemal for his injury, a court
will probably find:
a. The school liable for allowing the court to be used
b. Jemal committed a negligence tort
c. Jemal strictly liable for Kevin's harms
d. Jemal's acts where the cause-in-harm of Kevin's injuries
e. none of the other choices
299. In one case a woman shopping at K-Mart was accused by a security guard, after she walked out of the store, of
having put merchandise in her purse. She denied it and opened her purse so he could look in it. He still insisted she
took things and told her to come back into the store. Eventually a manager intervened and let her leave. She sued
and won $175,000 for false imprisonment. K-Mart appealed. You would expect the court to hold:
a. that no false imprisonment took place because the store had "reasonable suspicion" and released her after a
short time
b. that no violation of privacy took place because her person was not touched
c. that a jury could reasonably have found a false imprisonment in this circumstance
d. that jury acted with prejudice against the right of the store to protect its property
e. the jury award ($175,000) was excessive and had to be cut
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300. Alex sues Lisa for $60,000 for damages suffered as a result of her negligence because she failed to place a sign on
the door of her restaurant warning customers to "Watch Your Step" as they exited the building. A jury awards Alex
$40,000 because Alex's intoxication made him 33% responsible for his injuries. Lisa avoided full liability because
she showed:
a. comparative negligence
b. intoxicating negligence
c. intervening conduct
d. assumption of risk
e. evil intent
301. Alex sues Lisa for $60,000 for damages suffered as a result of her negligence because she failed to place a sign on
the door of her restaurant warning customers to "Watch Your Step" as they exited the building. A jury awards Alex
$40,000 because Alex's intoxication made him 33% responsible for his injuries. Lisa avoided full liability because
she showed:
a. res ipsa loquitur
b. intoxicating negligence
c. intervening conduct
d. assumption of risk
e. none of the other choices
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302. If Sam points a gun at Harry, a stranger, and says "Prepare to die," but then does nothing, the tort possibly
committed is:
a. negligence
b. assault
c. battery
d. slander
e. none of the other choices
303. If Sam points a gun at Harry, a stranger, and says "Prepare to die," but then does nothing, the tort possibly
committed is:
a. negligence
b. invasion of privacy
c. battery
d. slander
e. none of the other choices
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304. Fred approaches his co-worker Gloria in the office supply room and closes the door. Fred describes, in detail, the
porno movie he watched last night. Fred has Gloria "trapped" in the room, causing her to fear that he might try
something. Fred says that since they are alone he could show Gloria what the movie was about. Fred:
a. might be liable for assault
b. might be liable for battery
c. might be liable for invasion of privacy
d. might be liable for nuisance
e. has committed no tort, he just has bad judgment
305. You run towards someone screaming and swinging a stick. You were only kidding, but the person you were running
at thought you were serious. You might be sued for the tort of:
a. invasion of right to privacy
b. libel
c. assault
d. battery
e. false imprisonment
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306. John refuses to pay his bill due at a store. The store owner grabs John by the shirt, screams in his face and
demands the money "or else." John is shaken but unhurt. John would most likely sue for the tort of:
a. slander
b. assault
c. battery
d. negligence
e. trespass
307. John refuses to pay his bill due at a store. The store owner grabs John by the shirt, screams and him, and demands
the money "or else." John is shaken but unhurt. John would most likely sue for the tort of:
a. slander
b. assault
c. invasion of privacy
d. negligence
e. none of the other choices
308. Assume that Karen walks up to you and slaps you in the face. You slap her back. She sues you for battery. In this
case, you:
a. have a defense of privilege
b. have a defense of self-defense
c. have a defense of consent
d. have a defense of assault
e. are guilty; pay up
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309. The law permits certain defensive actions to be taken without incurring tort liability. Courts would be unlikely to
allow which defensive actions?
a. shooting a man who is raping a woman at knife-point
b. shooting someone who attempts to steal your new Lexus
c. holding someone down who has hit your friend
d. grabbing and holding someone who attempts to steal your new Lexus
e. c and d
310. While playing volleyball you are set to return a shot when another player stupidly runs up behind you and also tries
to get the ball. This player (on your team) knocks you down; you break your arm. There is:
a. a tort of assault
b. a tort of battery
c. a tort of assault and battery
d. no tort; you gave your consent to risk injury
e. none of the other choices

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