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1) Sales Taxes collected by the retailer are reported as:

A) Contingent liabilities.

B) Revenues.

C) Expenses.

D) Current liabilities.

2) Which one of the given would be categorized as the extraordinary item?

A) Expropriation of property by foreign government

B) Losses attributed to the labor strike

C) prepare-down of inventories

D) Gains or losses from the sales of equipment

3) Internal auditors:

A) Are hired by CPA firms to the audit business firms.

B) Are employees of the IRS who assess the internal controls of companies filing tax returns?

C) Assess the system of internal controls for the companies which employ them.

D) Can't assess the system of internal controls of the company which employs them as they are not independent.

4) The return on common stockholder's equity is find outd by dividing total income:

A) By ending common stockholder's equity.

B) By average common stockholder's equity.

C) Less favored dividends by ending common stockholder's equity.

D) Less favored dividends by the average common stockholder's equity.

5) In a small business, the lack of some separations of duties can best be overcome by:

A) Bonding the employees.

B) Getting the owner actively included.

C) Hiring just honest employees.

D) Holding one person answerable for a given set of transactions.

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