AWMA Exam 1, 2025|2026 Actual Comprehensive Real Exam
Questions And Verified Answers | 100% Correct Answers |
Already Graded A+ | Newest Exam | Just Released!!
All of the following are potential personal security risks except
A) serving on a board.
B)kidnapping.
C)extortion.
D)home invasion. - ANSWER-A) Home invasion, kidnapping,
and extortion are all personal security risks that high net worth
people need to be concerned with. Serving on a board presents
personal liability risks, but not to one's security merely from
serving on the board. Mod 4
Even if the host is not held liable for the damages as a result
of entertaining
guests, there can still be significant
expense due to
A)out-of-court settlements.
B)event preparation.
C)defense costs.
D)insurance premiums. - ANSWER-C) Most people occasionally
entertain guests. People who host events have a risk of
lawsuits from guests who may be injured or may injure others.
While most of the time everyone has a wonderful time and no
one gets hurt, all it takes is one person who is careless or
intoxicated and a significant liability exposure occurs. Even if
,the host is not held liable for the damages, the defense costs
can be quite high. Mod 4
Perhaps the best preventive measure high net worth clients can
take to reduce
the likelihood of personal and security
losses is to
A)get highly trained guard dogs to protect the property.
B)purchase appropriate insurance policies.
C)keep a top-notch legal team on retainer to represent the client
when needed. D)educate themselves as to how, when, and
where threats can materialize. - ANSWER-D) Insurance policies
can only respond to claims, not prevent them. The same goes
for a crack legal team on retainer. Guard dogs may prevent
some risks, but the best option is to be educated about what
threats can materialize and how. Security specialists can
develop a comprehensive security plan that involves home
protection and security, protection while traveling, and
prevention of identity theft and other cyberattacks. Mod 4
All the things that make a high net worth business owner's
business unique, including the knowledge, experience,
relationships, and human resources that create value can be
categorized as their
A)trade secrets.
B)intellectual capital.
C)business secrets.
,D)inventions. - ANSWER-B) Intellectual capital consists of all
the things that make the business owner's business unique,
including the knowledge, experience, relationships, and human
resources that create value. It may also consist of trademarks
and patents as well as brand names that the business has
developed. If a business owner client has invented a product or
a process that is unique, it may be the business's most
valuable asset. Mod 4
Partnership income is taxed at the
A)personal tax rates of the individual partners.
B)C corporation rate.
C)estates and trusts rate.
D)S corporation rate. - ANSWER-A) Partnership income is taxed
at the personal income tax rates of the individual partners,
because it is taxed to the partners.
Mod 4
Which one of the following currently is the most common
form of business
organization?
A)Partnership
B)Sole proprietorship
C)Limited liability company
D)C corporation - ANSWER-B) The sole proprietorship is the
most common form of business organization, with over 70% of
U.S. businesses filing income tax returns indicating they are
, sole proprietorships. Partnerships account for less than 10% of
all U.S. businesses, and approximately 20% of all U.S.
businesses are corporations. Mod 4
XYZ Inc., a C corporation, has $200,000 in taxable income this
tax year. It distributes half to its shareholders in the form of
cash dividends. As far as XYZ Inc. is concerned, which one of
the following amounts, if any, is subject to the corporate
income tax?
A)$150,000 (Half of corporate dividends are deductible.)
B)$100,000 (This is $200,000 less the dividend distribution.)
C)$0 (C corporations do not pay income tax.)
D)$200,000 (None of the corporate dividends are deductible.) -
ANSWER-D) Since XYZ Inc. has taxable income of $200,000,
that is the amount subject to tax. Dividends are not deductible.
Mod 4
Bill Dunston is the sole shareholder of Dunston Press, a small
publishing company. All of the employees of Dunston Press are
considerably younger than Bill, turnover is relatively high, and
12 of his 20 employees are part time. He is considering
implementing a retirement plan for the company and wants to
avoid fixed contribution obligations. He also wants to receive
the maximum benefit possible. Which one of the following
plans would be most appropriate, considering Bill wants to
maximize contributions on his behalf relative to those of the
other employees?
Questions And Verified Answers | 100% Correct Answers |
Already Graded A+ | Newest Exam | Just Released!!
All of the following are potential personal security risks except
A) serving on a board.
B)kidnapping.
C)extortion.
D)home invasion. - ANSWER-A) Home invasion, kidnapping,
and extortion are all personal security risks that high net worth
people need to be concerned with. Serving on a board presents
personal liability risks, but not to one's security merely from
serving on the board. Mod 4
Even if the host is not held liable for the damages as a result
of entertaining
guests, there can still be significant
expense due to
A)out-of-court settlements.
B)event preparation.
C)defense costs.
D)insurance premiums. - ANSWER-C) Most people occasionally
entertain guests. People who host events have a risk of
lawsuits from guests who may be injured or may injure others.
While most of the time everyone has a wonderful time and no
one gets hurt, all it takes is one person who is careless or
intoxicated and a significant liability exposure occurs. Even if
,the host is not held liable for the damages, the defense costs
can be quite high. Mod 4
Perhaps the best preventive measure high net worth clients can
take to reduce
the likelihood of personal and security
losses is to
A)get highly trained guard dogs to protect the property.
B)purchase appropriate insurance policies.
C)keep a top-notch legal team on retainer to represent the client
when needed. D)educate themselves as to how, when, and
where threats can materialize. - ANSWER-D) Insurance policies
can only respond to claims, not prevent them. The same goes
for a crack legal team on retainer. Guard dogs may prevent
some risks, but the best option is to be educated about what
threats can materialize and how. Security specialists can
develop a comprehensive security plan that involves home
protection and security, protection while traveling, and
prevention of identity theft and other cyberattacks. Mod 4
All the things that make a high net worth business owner's
business unique, including the knowledge, experience,
relationships, and human resources that create value can be
categorized as their
A)trade secrets.
B)intellectual capital.
C)business secrets.
,D)inventions. - ANSWER-B) Intellectual capital consists of all
the things that make the business owner's business unique,
including the knowledge, experience, relationships, and human
resources that create value. It may also consist of trademarks
and patents as well as brand names that the business has
developed. If a business owner client has invented a product or
a process that is unique, it may be the business's most
valuable asset. Mod 4
Partnership income is taxed at the
A)personal tax rates of the individual partners.
B)C corporation rate.
C)estates and trusts rate.
D)S corporation rate. - ANSWER-A) Partnership income is taxed
at the personal income tax rates of the individual partners,
because it is taxed to the partners.
Mod 4
Which one of the following currently is the most common
form of business
organization?
A)Partnership
B)Sole proprietorship
C)Limited liability company
D)C corporation - ANSWER-B) The sole proprietorship is the
most common form of business organization, with over 70% of
U.S. businesses filing income tax returns indicating they are
, sole proprietorships. Partnerships account for less than 10% of
all U.S. businesses, and approximately 20% of all U.S.
businesses are corporations. Mod 4
XYZ Inc., a C corporation, has $200,000 in taxable income this
tax year. It distributes half to its shareholders in the form of
cash dividends. As far as XYZ Inc. is concerned, which one of
the following amounts, if any, is subject to the corporate
income tax?
A)$150,000 (Half of corporate dividends are deductible.)
B)$100,000 (This is $200,000 less the dividend distribution.)
C)$0 (C corporations do not pay income tax.)
D)$200,000 (None of the corporate dividends are deductible.) -
ANSWER-D) Since XYZ Inc. has taxable income of $200,000,
that is the amount subject to tax. Dividends are not deductible.
Mod 4
Bill Dunston is the sole shareholder of Dunston Press, a small
publishing company. All of the employees of Dunston Press are
considerably younger than Bill, turnover is relatively high, and
12 of his 20 employees are part time. He is considering
implementing a retirement plan for the company and wants to
avoid fixed contribution obligations. He also wants to receive
the maximum benefit possible. Which one of the following
plans would be most appropriate, considering Bill wants to
maximize contributions on his behalf relative to those of the
other employees?
