CPA PRACTICE EXAM WITH ALL
NEEDED TO PASS
When ga gCPA gexamines ga gclient's gprojected gfinancial gstatements, gthe gCPA's
greport gshould: g- gcorrect ganswers g-state gthat gthe gCPA gperformed gprocedures gto
gevaluate gmanagement's gassumptions.
Davis, gCPA, gaccepted gan gengagement gto gaudit gthe gfinancial gstatements gof gTech
gResources, ga gnonpublic gentity. gBefore gthe gcompletion gof gthe gaudit, gTech
grequested gDavis gto gchange gthe gengagement gto ga gcompilation gof gfinancial
gstatements. gBefore gDavis gagrees gto gchange gthe gengagement, gDavis gis grequired
gto gconsider gthe:
additional gaudit geffort gnecessary gto gcomplete gthe gaudit.
reason ggiven gfor gTech's grequest. g- gcorrect ganswers g-Both gI gand gII
, The gGAO gstandards glist gseveral gthreats gto gindependence. gThe gthreat gof
gfamiliarity gis gdefined gas: g- gcorrect ganswers g-when, gdue gto ga glong gor gclose
grelationship gwith gmanagement gor gother gpersonnel, gthe gauditor gwill gbe gtoo
gsympathetic gor gaccepting gof gwork.
Which gof gthe gfollowing grepresentations gdoes gan gaccountant gmake gimplicitly gwhen
gissuing gthe gstandard greport gfor gthe gcompilation gof ga gnonissuer's gfinancial
gstatements? g- gcorrect ganswers g-The gaccountant gis gindependent gwith grespect gto
gthe gentity.
Heath gCo.'s gcurrent gratio gis g4:1. gWhich gof gthe gfollowing gtransactions gwould
gnormally gincrease gits gcurrent gratio? g- gcorrect ganswers g-Selling ginventory gon
gaccount
According gto gthe gAICPA gCode gof gProfessional gConduct, gwhat gwould ga gcovered
gmember gmost gappropriately gdo gupon glearning gthat ganother gmember gof gan gattest
gengagement gteam gis gconsidering gemployment gwith gthe gclient? g- gcorrect ganswers
g-Notify gan gappropriate gperson gin gthe gfirm.
Which gof gthe gfollowing gfactors gmost glikely gwould gassist gan gindependent gauditor
gin gassessing gthe gobjectivity gof gthe ginternal gauditor? g- gcorrect ganswers g-The
gorganizational gstatus gof gthe gdirector gof ginternal gaudit
If gthe gbusiness genvironment gis gexperiencing ga grecession, gthe gauditor gmost glikely
gwould gfocus gincreased gattention gon gwhich gof gthe gfollowing gaccounts? g- gcorrect
ganswers g-Allowance gfor gdoubtful gaccounts
An gauditor gis greporting gon gcondensed gfinancial gstatements gfor gan gannual gperiod
gthat gare gderived gfrom gthe gaudited gfinancial gstatements gof gan gissuer. gThe
gauditor's gopinion gshould gindicate gwhether gthe ginformation gin gthe gcondensed
gfinancial gstatements gis gfairly gstated gin gall gmaterial grespects: g- gcorrect ganswers g-
in grelation gto gthe gcomplete gfinancial gstatements.
An gauditor gobserves gthe gmailing gof gmonthly gstatements gto ga gclient's gcustomers
gand greviews gevidence gof gfollow-up gon gerrors greported gby gthe gcustomers. gThis
gtest gof gcontrols gmost glikely gis gperformed gto gsupport gmanagement's gfinancial
gstatement gassertion gof: g- gcorrect ganswers g-existence.
North gCo., ga gprivately gheld gentity, gasked gits gtax gaccountant, gKing, ga gCPA gin
gpublic gpractice, gto greview gand ggenerate gNorth's ginterim gfinancial gstatements gon
gKing's gmicrocomputer gwhen gKing gprepared gNorth's gquarterly gtax greturn. gKing
gshould gnot gsubmit gthese gfinancial gstatements gto gNorth gunless, gas ga gminimum,
gKing gcomplies gwith gthe gprovisions gof: g- gcorrect ganswers g-Statements gon
gStandards gfor gAccounting gand gReview gServices.
NEEDED TO PASS
When ga gCPA gexamines ga gclient's gprojected gfinancial gstatements, gthe gCPA's
greport gshould: g- gcorrect ganswers g-state gthat gthe gCPA gperformed gprocedures gto
gevaluate gmanagement's gassumptions.
Davis, gCPA, gaccepted gan gengagement gto gaudit gthe gfinancial gstatements gof gTech
gResources, ga gnonpublic gentity. gBefore gthe gcompletion gof gthe gaudit, gTech
grequested gDavis gto gchange gthe gengagement gto ga gcompilation gof gfinancial
gstatements. gBefore gDavis gagrees gto gchange gthe gengagement, gDavis gis grequired
gto gconsider gthe:
additional gaudit geffort gnecessary gto gcomplete gthe gaudit.
reason ggiven gfor gTech's grequest. g- gcorrect ganswers g-Both gI gand gII
, The gGAO gstandards glist gseveral gthreats gto gindependence. gThe gthreat gof
gfamiliarity gis gdefined gas: g- gcorrect ganswers g-when, gdue gto ga glong gor gclose
grelationship gwith gmanagement gor gother gpersonnel, gthe gauditor gwill gbe gtoo
gsympathetic gor gaccepting gof gwork.
Which gof gthe gfollowing grepresentations gdoes gan gaccountant gmake gimplicitly gwhen
gissuing gthe gstandard greport gfor gthe gcompilation gof ga gnonissuer's gfinancial
gstatements? g- gcorrect ganswers g-The gaccountant gis gindependent gwith grespect gto
gthe gentity.
Heath gCo.'s gcurrent gratio gis g4:1. gWhich gof gthe gfollowing gtransactions gwould
gnormally gincrease gits gcurrent gratio? g- gcorrect ganswers g-Selling ginventory gon
gaccount
According gto gthe gAICPA gCode gof gProfessional gConduct, gwhat gwould ga gcovered
gmember gmost gappropriately gdo gupon glearning gthat ganother gmember gof gan gattest
gengagement gteam gis gconsidering gemployment gwith gthe gclient? g- gcorrect ganswers
g-Notify gan gappropriate gperson gin gthe gfirm.
Which gof gthe gfollowing gfactors gmost glikely gwould gassist gan gindependent gauditor
gin gassessing gthe gobjectivity gof gthe ginternal gauditor? g- gcorrect ganswers g-The
gorganizational gstatus gof gthe gdirector gof ginternal gaudit
If gthe gbusiness genvironment gis gexperiencing ga grecession, gthe gauditor gmost glikely
gwould gfocus gincreased gattention gon gwhich gof gthe gfollowing gaccounts? g- gcorrect
ganswers g-Allowance gfor gdoubtful gaccounts
An gauditor gis greporting gon gcondensed gfinancial gstatements gfor gan gannual gperiod
gthat gare gderived gfrom gthe gaudited gfinancial gstatements gof gan gissuer. gThe
gauditor's gopinion gshould gindicate gwhether gthe ginformation gin gthe gcondensed
gfinancial gstatements gis gfairly gstated gin gall gmaterial grespects: g- gcorrect ganswers g-
in grelation gto gthe gcomplete gfinancial gstatements.
An gauditor gobserves gthe gmailing gof gmonthly gstatements gto ga gclient's gcustomers
gand greviews gevidence gof gfollow-up gon gerrors greported gby gthe gcustomers. gThis
gtest gof gcontrols gmost glikely gis gperformed gto gsupport gmanagement's gfinancial
gstatement gassertion gof: g- gcorrect ganswers g-existence.
North gCo., ga gprivately gheld gentity, gasked gits gtax gaccountant, gKing, ga gCPA gin
gpublic gpractice, gto greview gand ggenerate gNorth's ginterim gfinancial gstatements gon
gKing's gmicrocomputer gwhen gKing gprepared gNorth's gquarterly gtax greturn. gKing
gshould gnot gsubmit gthese gfinancial gstatements gto gNorth gunless, gas ga gminimum,
gKing gcomplies gwith gthe gprovisions gof: g- gcorrect ganswers g-Statements gon
gStandards gfor gAccounting gand gReview gServices.
