1) the _____ requires a public company to disclose whether it has adopted a code of
ethics for senior financial officers, and to disclose any change in the code or waiver of
the codes application.
a.davis-bacon act
b.goldwater-nichols act
c.sarbanes-oxley act
d.certiorari act
2) according to revised article 3, the risk of loss from fraudulent indorsements by
employees:
a.should fall on the holder in due course.
b.should fall on the employer.
c.should fall on the bank.
d.should fall on the employee.
3) a dissociated limited partner:
a.retains his right to receive profits.
b.retains his right to vote as a limited partner.
c.loses his limited liability status.
d.retains his managerial powers.
4) which of the following characterizes common carriers?
a.they have the same degree of responsibility as private carriers.
b.they are near-absolute insurers of the goods they carry.
c.they do not have a government license.
d.they are not allowed to carry perishable goods.
5) a totten trust is created when a person:
a.deposits money in a bank for the benefit of another.
b.directs in his will that a trust be created upon that persons death.
c.executes the creation using a holographic will.
d.opens a trust only for the benefit of poor people.
6) a partners contribution is also called _____.
a.partnership property
b.partnership liability
c.partnership cash flow
d.partnership capital
7) xyz bank pays a check that contains a restrictive indorsement for collection. this
indicates that:
a.the bank has paid the check illegally.
b.the bank has not acted in good faith.
c.the bank was negligent with the payment of the check.
d.the bank has converted the check.
8) in a state that has adopted the ultramares rule and uses the primary benefit test, who
amongst the following may hold an accountant liable for common law negligence?
a.only the client.
b.only the client and a third party that the accountant knew would rely on the
accountants work for a particular purpose.
c.only the client. a third party that the accountant knew would rely on the accountants
work for a particular purpose, and others who are in the same limited class as that third
party.
d.any third party that is a foreseeable user of the accountants work may hold him/her
liable if that third party suffers a loss as a direct result of the accountants negligence.
9) a contract that cannot be performed within one year from the day on which it comes
into existence:
a.is within the statute of frauds.
b.need not be in writing.
c.is called a unilateral contract.
d.is essentially illegal.
10) _____ include expenses that the buyer incurs in receiving, inspecting, transporting,
and storing goods shipped by the seller that do not conform to those called for in the
contract.
a.unconscionable damages
b.incidental damages
c.penalties
d.consequential damages
11) what is the standard applied to examine managers duty of care?
a.the degree of care expected from an intelligent person faced with a complex problem.
b.the care expected from a shopkeeper while selling expensive goods.
c.the care expected from an ordinarily prudent man in similar circumstances.
d.the degree of care expected from a prudent businessman during economic downturn.
12) ian sanders offered to sell his car to beth jones for $5,000 with beths agreement.
subsequently, beth demanded that he provide new seat covers for the car as she was
paying a rather heavy price for the car. beths response represents a(n) _____.
a.inquiry regarding terms
b.rejection of the offer
c.conditional acceptance of the offer
d.additional term
13) which of the following is most likely to breach one of the trustees fiduciary duties?
a.selling stock owned by the trust to realize capital gains.
b.selling stock owned by the trust because it has declined in value over the last three
years.
c.delegating the selection of trust investments to an investment advisor.
d.delegating the preparation of statements of account to an accountant.
14) under the restatement (second) of torts, which of the following nonclients may sue
an accountant for professional negligence?
a.a securities investor whose use of the financial statements prepared by the accountant
to purchase common shares was foreseeable by the accountant.
b.a bank that was not known to the accountant and whose use of the financial
statements was not foreseen, but whose use of the financial statements was foreseeable.
c.a bank that was known to the accountant but used the financial statements prepared by
the accountant for a purpose that was not foreseen.
d.a creditor who was not known to the accountant but who used the financial statements
for the same purpose as the bank whose use of the statements was known to the
accountant.
15) in order to establish a cause of action based upon strict liability in tort for personal
injuries resulting from the use of a defective product, the plaintiff must start the case by
proving that the seller (defendant):
a.was engaged in the business of selling the product.
b.failed to exercise due care.
c.defectively designed the product.
d.was in privity of contract with the plaintiff.
16) linda was visiting jose at his apartment. while she was there, linda slipped on a
banana peel that jose had negligently left on the kitchen floor. linda was injured and
sued both jose and his landlord. who is liable to linda?
a.both jose and the landlord are liable.
b.jose is liable because he was negligent.
c.the landlord is liable for all accidents that happen in his apartment.
d.no one is liable.
17) which of the following would be a nonnegotiable instrument?
a.payment is subject to the terms of a mortgage dated august 12, 2011.
b.a statement in the instrument that it was given in payment of last months rent.
c.a statement in the instrument that it was given in payment of the purchase price of
goods.
d.this note is secured by a mortgage dated january 13, 2011.
18) in which of the following situations can a buyer revoke acceptance of
nonconforming goods?
a.the buyer accepted them without knowledge of the nonconformity because of the
difficulty of discovering the nonconformity.
b.the buyer accepted them with the knowledge of the nonconformity, because they were
the only option available in the market.
c.the price of the goods fell in the general market.
d.the buyer accepted the nonconforming goods because the seller couldnt cure the
defect.
19) under title vii, when can a private plaintiff file a lawsuit?
a.within 90 days of receiving the right-to-sue letter
b.within 120 days of filing a charge with the eeoc
c.within 120 days of receiving the right-to-sue letter
d.within 90 days of filing a charge with the eeoc