WGU D216 BUSINESS LAW FOR ACCOUNTANTS EXAM – QUESTIONS
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1. Which of the following sources of law is created by legislative bodies such as the U.S.
Congress and state legislatures?
A. Administrative law
B. Statutory law
C. Common law
D. Case law
Statutory law consists of written laws enacted by legislative bodies, such as the U.S. Congress
and state legislatures. Administrative law is created by administrative agencies, while common
law and case law are derived from judicial decisions and precedent.
2. A plaintiff files a civil lawsuit alleging breach of contract against an accounting firm.
What is the standard of proof required for the plaintiff to win the case?
A. Beyond a reasonable doubt
B. Probable cause
C. Clear and convincing evidence
D. Preponderance of the evidence
In civil lawsuits, including breach of contract claims against professionals, the standard of
proof is a preponderance of the evidence, meaning the plaintiff must show that the claim is
more likely true than not. Beyond a reasonable doubt is reserved for criminal cases.
3. Under the doctrine of stare decisis, courts are generally required to follow what type of
authority when deciding cases with similar legal issues?
A. Legislative lobbying reports
B. Persuasive executive orders
C. Precedent established by prior court decisions
D. Academic legal commentary
Stare decisis is the legal principle by which judges are obligated to respect the precedents
established by prior court decisions within their jurisdiction. This doctrine promotes
consistency and predictability in the legal system.
4. Which constitutional clause grants the federal government the power to regulate
commerce among the several states?
A. The Supremacy Clause
B. The Commerce Clause
,C. The Due Process Clause
D. The Equal Protection Clause
The Commerce Clause of the U.S. Constitution empowers Congress to regulate commerce
with foreign nations, among the several states, and with Indian tribes, serving as the basis for
much of federal business regulation.
5. A state statute conflicts directly with a valid federal law regulating interstate commerce.
According to the Supremacy Clause, what is the legal result?
A. Both laws remain fully enforceable concurrently.
B. The state law takes precedence within that state's borders.
C. The federal law preempts the conflicting state law.
D. The dispute must be resolved by a statewide referendum.
Under the Supremacy Clause of the U.S. Constitution, federal law is the supreme law of the
land. When a direct conflict exists between federal and state law, federal law preempts and
invalidates the state law.
6. What is the primary function of intermediate appellate courts in the state or federal
court system?
A. To conduct new jury trials and hear witness testimony
B. To review trial court proceedings for errors of law
C. To draft new statutes for legislative approval
D. To negotiate settlements between opposing parties
Appellate courts do not hold trials, hear new witness testimony, or accept new evidence. Their
sole function is to review the trial court record to determine whether errors of law or legal
procedure occurred during the trial.
7. Which alternative dispute resolution method involves a neutral third party who listens to
both sides and renders a legally binding decision?
A. Negotiation
B. Mediation
C. Arbitration
D. Conciliation
Arbitration involves a neutral third party, known as an arbitrator, who hears arguments,
reviews evidence, and issues a decision that is legally binding on the parties. Mediation uses a
neutral third party to facilitate settlement discussions without issuing a binding ruling.
8. A disgruntled client threatens to sue an accounting firm over a tax preparation error.
Both parties agree to hire a neutral facilitator to help them reach a voluntary settlement.
What process are they utilizing?
A. Litigation
, B. Mediation
C. Binding arbitration
D. Judicial review
Mediation is a voluntary, confidential process where a neutral third party facilitates
communication between disputing parties to help them reach a mutually acceptable
resolution. The mediator does not impose a binding decision.
9. In a federal civil lawsuit, which party bears the initial burden of filing a formal pleading
that sets forth the claims and factual allegations?
A. The defendant
B. The plaintiff
C. The presiding judge
D. The appellate court clerk
The plaintiff initiates a civil lawsuit by filing a complaint, which is the initial pleading setting
forth the legal claims, factual allegations, and the relief sought from the court. The defendant
responds by filing an answer.
10. During the pretrial discovery phase, a CPA expert witness receives a written request
from opposing counsel asking for sworn, written answers to specific factual questions.
What is this discovery tool called?
A. A deposition
B. Interrogatories
C. A request for admissions
D. A subpoena duces tecumCorrect Answer: B. Interrogatories
Interrogatories are written questions submitted by one party to another that must be answered
under oath. Depositions involve oral testimony taken under oath, while requests for
admissions ask a party to admit or deny specific facts.
11. Which of the following elements is required to form a valid, legally enforceable
contract?
A. Notarization by a licensed public official
B. Consideration
C. Approval by a regulatory agency
D. Writing on physical paper
The essential elements of a valid contract are agreement (offer and acceptance), consideration
(something of legal value given in exchange for a promise), contractual capacity, and legal
object. Not all contracts must be in writing or notarized.
AND ANSWERS | VERIFIED AND WELL DETAILED ANSWERS PLUS
RATIONALES | GUARANTEED PASS | LATEST EXAM UPDATE | EXAM
PREP | STUDY GUIDE | PRACTICE TEST| DOWNLOAD INSTANT PDF
1. Which of the following sources of law is created by legislative bodies such as the U.S.
Congress and state legislatures?
A. Administrative law
B. Statutory law
C. Common law
D. Case law
Statutory law consists of written laws enacted by legislative bodies, such as the U.S. Congress
and state legislatures. Administrative law is created by administrative agencies, while common
law and case law are derived from judicial decisions and precedent.
2. A plaintiff files a civil lawsuit alleging breach of contract against an accounting firm.
What is the standard of proof required for the plaintiff to win the case?
A. Beyond a reasonable doubt
B. Probable cause
C. Clear and convincing evidence
D. Preponderance of the evidence
In civil lawsuits, including breach of contract claims against professionals, the standard of
proof is a preponderance of the evidence, meaning the plaintiff must show that the claim is
more likely true than not. Beyond a reasonable doubt is reserved for criminal cases.
3. Under the doctrine of stare decisis, courts are generally required to follow what type of
authority when deciding cases with similar legal issues?
A. Legislative lobbying reports
B. Persuasive executive orders
C. Precedent established by prior court decisions
D. Academic legal commentary
Stare decisis is the legal principle by which judges are obligated to respect the precedents
established by prior court decisions within their jurisdiction. This doctrine promotes
consistency and predictability in the legal system.
4. Which constitutional clause grants the federal government the power to regulate
commerce among the several states?
A. The Supremacy Clause
B. The Commerce Clause
,C. The Due Process Clause
D. The Equal Protection Clause
The Commerce Clause of the U.S. Constitution empowers Congress to regulate commerce
with foreign nations, among the several states, and with Indian tribes, serving as the basis for
much of federal business regulation.
5. A state statute conflicts directly with a valid federal law regulating interstate commerce.
According to the Supremacy Clause, what is the legal result?
A. Both laws remain fully enforceable concurrently.
B. The state law takes precedence within that state's borders.
C. The federal law preempts the conflicting state law.
D. The dispute must be resolved by a statewide referendum.
Under the Supremacy Clause of the U.S. Constitution, federal law is the supreme law of the
land. When a direct conflict exists between federal and state law, federal law preempts and
invalidates the state law.
6. What is the primary function of intermediate appellate courts in the state or federal
court system?
A. To conduct new jury trials and hear witness testimony
B. To review trial court proceedings for errors of law
C. To draft new statutes for legislative approval
D. To negotiate settlements between opposing parties
Appellate courts do not hold trials, hear new witness testimony, or accept new evidence. Their
sole function is to review the trial court record to determine whether errors of law or legal
procedure occurred during the trial.
7. Which alternative dispute resolution method involves a neutral third party who listens to
both sides and renders a legally binding decision?
A. Negotiation
B. Mediation
C. Arbitration
D. Conciliation
Arbitration involves a neutral third party, known as an arbitrator, who hears arguments,
reviews evidence, and issues a decision that is legally binding on the parties. Mediation uses a
neutral third party to facilitate settlement discussions without issuing a binding ruling.
8. A disgruntled client threatens to sue an accounting firm over a tax preparation error.
Both parties agree to hire a neutral facilitator to help them reach a voluntary settlement.
What process are they utilizing?
A. Litigation
, B. Mediation
C. Binding arbitration
D. Judicial review
Mediation is a voluntary, confidential process where a neutral third party facilitates
communication between disputing parties to help them reach a mutually acceptable
resolution. The mediator does not impose a binding decision.
9. In a federal civil lawsuit, which party bears the initial burden of filing a formal pleading
that sets forth the claims and factual allegations?
A. The defendant
B. The plaintiff
C. The presiding judge
D. The appellate court clerk
The plaintiff initiates a civil lawsuit by filing a complaint, which is the initial pleading setting
forth the legal claims, factual allegations, and the relief sought from the court. The defendant
responds by filing an answer.
10. During the pretrial discovery phase, a CPA expert witness receives a written request
from opposing counsel asking for sworn, written answers to specific factual questions.
What is this discovery tool called?
A. A deposition
B. Interrogatories
C. A request for admissions
D. A subpoena duces tecumCorrect Answer: B. Interrogatories
Interrogatories are written questions submitted by one party to another that must be answered
under oath. Depositions involve oral testimony taken under oath, while requests for
admissions ask a party to admit or deny specific facts.
11. Which of the following elements is required to form a valid, legally enforceable
contract?
A. Notarization by a licensed public official
B. Consideration
C. Approval by a regulatory agency
D. Writing on physical paper
The essential elements of a valid contract are agreement (offer and acceptance), consideration
(something of legal value given in exchange for a promise), contractual capacity, and legal
object. Not all contracts must be in writing or notarized.
