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jonny [76]
3 years ago
14

A cpa firm performs the annual audit of the leahy group, a private company. the client has asked the firm to perform a study to

determine whether the company would qualify for certain municipal tax credits and prepare the request. the firm will receive 15 percent of any tax credits that leahy obtains for the client as a result of the request but no fees if the request is denied. city officials do not perform a substantive review of each request for tax credits. would this fee arrangement be permitted under the aicpa code of professional conduct?
Business
1 answer:
nikitadnepr [17]3 years ago
7 0
No, this is not permitted under the AICPA Code of Conduct. The fee of the firm would have based<span> solely on the success of their task. Under the Code, it is allowed to received payment based on the work they have done but it is not the sole basis for its payment. In this situation, there is no agreed payment except for the success of their task so there will be an opportunity of fraud for the firm here in order to receive the fee. To compensate this problem, the Code did not allow this type of payment terms (the fee is based solely in the success of the tax credits they may earn).</span>
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A long one with numbers, lowercased letters, and uppercased letters
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Odessa Corporation had 20,000 shares of $2 par value common stock outstanding on July 1. On that day, the board of directors dec
Nataly [62]

Answer:

Debit Retained earnings $18,000

Credit Common stock $4,000

Credit paid in capital in excess of par value common stock $14,000

<em>(To record declaration of 10% stock dividend)</em>

Explanation:

The overall effect this declaration would has on the retained earnings would be determined using the current market value, meanwhile the effect on common stock would determined using the par value.

The appropriate entries above were determined by:

Stock dividend declared = 10% x 20,000 units x $9 = $18,000

The effect on common stock will be = 10% x 20,000 unit x $2 = $4,000

So, paid in capital in excess of par value common stock is $18,000 - $4,000 = $14,000.

3 0
3 years ago
Which of the following countries is the world's leading exporter of cacao beans?
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The country that is the world's leading exporter of cacao beans is Cote d'lvoire. Since the 60's, the production of these beans has increased to 3.6 million tonnes. The 2nd highest country that is an exporter of cacao beans is Ghana. The correct answer is A. 
8 0
3 years ago
Blaster Corporation manufactures hiking boots. For the coming year, the company has budgeted the following costs for the product
Aleks [24]

Answer:

a. Sales volume = (Fixed costs + Target income) / Contribution margin per unit

     Fixed costs = ( Percentage of fixed Selling and Admin expenses) +  

      Percentage of fixed Manufacturing expenses

     = 600,000 * 80% + 720,000 * 75%

     = 480,000 + 540,000

     = $1,020,000

30,000 units = (1,020,000 + 900,000) / Contribution Margin per unit

Contribution margin per unit = 1,920,000/30,000

= $64

Sales per unit = Contribution margin per unit  + Variable cost per unit

       Variable Cost per unit = 21 + 10 + (24*25%) + (20 * 20%)

        = $41

Sales per unit = 64 + 41

= $105 per unit

b - 1. Fixed costs = ( Percentage of fixed Selling and Admin expenses) + Percentage of fixed Manufacturing expenses

= 600,000 * 80% + 720,000 * 75%

= 480,000 + 540,000

= $1,020,000

b - 2. Variable Cost per unit

= Direct materials + Direct Labor + variable percentage of Manufacturing overhead cost per unit + variable percentage of Selling and administrative per unit

= 21 + 10 + (24*25%) + (20 * 20%)

= $41

b - 3. Contribution margin = Selling price - Variable cost

= 121 - 41

= $80

b - 4. Breakeven Point = Fixed Cost / Contribution margin

= 1,020,000/80

= 12,750 units

3 0
3 years ago
Rocky River Company is a​ price-taker and uses target pricing. Refer to the following​ information: Production volume ​602,000 u
uranmaximum [27]

Answer:

$26.59

Explanation:

Data provided in the question:

Production volume ​= 602,000 units per year

Market price = ​$30 per unit

Desired operating income = ​15% of total assets

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Now,

Target profit = 15% of $13,700,000

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Sale value = 602,000 × $30

= $18,060,000

Therefore,

Total cost = sale value -target profit

= $18,060,000 - $2,055,000

= $16,005,000

Thus,

Price per unit = \frac{\textup{Total cost}}{\textup{Production volume}}

= \frac{\$16,005,000}{602,000}

= $26.586 ≈ $26.59

5 0
3 years ago
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