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CPA Ethics Exam With 100% Correct And Verified Answers
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CPA Ethics Exam With 100% Correct And Verified Answers
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CPA Ethics Exam With 100% CorrectAnd Verified Answers
Clients may recover from breach of contract if: - Correct
Answer-*Accountant agreed to perform services
professionally
*Accountant breached agreement
*Client suffered damages, and
*Breach proximately caused the damages
Recovery of fee for Breach of Contract - Correct Answer-
*Can't recover if major breach
*Recoverable minus damages if it was minor
Damages that clients can recover for Breach of Contract or
Negligence - Correct Answer-Compensatory, not punitive
Clients may recover for negligence if: - Correct Answer-
*Accountant owed a duty of due care
*Accountant breached the duty
*Client suffered damages, and
*Breach proximately caused the damages
Vendarsol
, Standard for Negligence - Correct Answer-That degree of
judgment and skill possessed by a reasonable accountant
under all the circumstances.
Fraud Liability for 3rd parties - Correct Answer-
*Accountant misrepresented a fact (or failed to disclose)
*Accountant acted with Scienter (intent to deceive)
*Plaintiff relied on false stmt or omission
*Damages
*Proximate cause
Actual vs. Constructive Fraud - Correct Answer-Actual
Fraud- acct knows stmt is false
Constructive Fraud- acct has no reasonable grounds to
believe the stmt is true (signing off on FS audit w/o auditing)
Damages recoverable under Fraud cases - Correct Answer-
Compensatory AND Punitive damages
Constructive Fraud - Correct Answer-Reckless disregard or
Gross Negligence
Restatement of Torts rule (Majority rule) - Correct Answer-
1)Information being supplied to the client will be given to or
is for the benefit of a LIMITED GROUP of third persons
Vendarsol
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