MC Questions on Ethics-1
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MC Questions on Ethics-1

Course Number: ACC 101, Spring 2013

College/University: Temple

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ACC 102 Ethics Questions Name: Class Time: 1. The Institute of Management Accountants' Statement of Ethical Professional Practice states that when faced with significant ethical issues, management accountants should first: A. discuss such problems with the immediate superior except when it appears that the superior is involved. B. clarify relevant concepts by confidential discussion with an objective advisor to...

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102 ACC Ethics Questions Name: Class Time: 1. The Institute of Management Accountants' Statement of Ethical Professional Practice states that when faced with significant ethical issues, management accountants should first: A. discuss such problems with the immediate superior except when it appears that the superior is involved. B. clarify relevant concepts by confidential discussion with an objective advisor to obtain an understanding of possible courses of action. C. follow the established policies of the organization bearing on the resolution of such conflict. D. submit an informative memorandum describing the ethical issue to an appropriate representative of the organization and resign if no action is taken as a result of the memorandum. 2. Under the Sarbanes-Oxley Act of 2002, the Public Company Accounting Oversight Board (PCAOB) established rules relating to the preparation of audit reports for issuers in which of the following? A. Auditing. B. Quality control. C. Ethics. D. Independence. E. All of the above. 3. Which of the following is not an element of competency? A. To develop appropriate knowledge about a particular subject. B. To perform duties in accordance with relevant laws. C. To perform duties in accordance with relevant technical standards. D. To refrain from engaging in an activity that would discredit the accounting profession. E. To prepare clear reports after an analysis of relevant and reliable information. 4. Assume that a managerial accountant regularly communicates with business associates to avoid conflicts of interest and advises relevant parties of potential conflicts. In so doing, the accountant will have applied the ethical standard of: A. objectivity. B. confidentiality. C. integrity. D. credibility. E. unified behavior. 5. As a Certified Management Accountant, Donna is bound by the standards of ethical conduct issued by the Institute of Management Accountants. Her company currently produces a component used in manufacturing several of the firm's products. In a report evaluating the desirability of buying the component instead, Donna compared the expected purchase price of the component to the cost of materials contained in the component. Select the correct statement from the following. A. Donna may have violated the confidentiality standard if she provided any confidential information about the firm's costs to outside vendors. B. Donna may have violated the competence standard because her report was incomplete in that it failed to consider other the costs required to manufacture the component in-house. C. Donna may have violated the credibility standard because she failed to disclose fully all relevant information that could influence this outsourcing decision. D. All of the above are correct. 6. As a Certified Management Accountant, Zandra is bound by the standards of ethical conduct issued by the Institute of Management Accountants. During the course of business, Zandra learned that her company has decided to discontinue a major product line. If she mentions this fact to her brother, who is a stockbroker, Zandra could be in violation of the A. competence standard. B. confidentiality standard. C. integrity standard. D. objectivity standard. 7. As a Certified Management Accountant, Denton is bound by the standards of ethical conduct issued by the Institute of Management Accountants. According to the standards, Denton has a responsibility to A. inform subordinates that they should protect confidential information. B. inform the federal enforcement authorities if he discovers that someone in the firm has used confidential information for illegal purposes. C. monitor the activities of subordinates to assure that confidentiality is maintained. D. A and C 8. As a Certified Management Accountant, Jill is bound by the standards of ethical conduct issued by the Institute of Management Accountants. If she accepts an expensive gift from a vendor trying to win a contract with her firm, which of the following standards will she violate? A. Competence B. Confidentiality C. Integrity D. Objectivity 9. The Sarbanes-Oxley Act of 2002 contains all of the following provisions EXCEPT: A. A CFO must be a CPA or CMA. B. The audit committee of the board of directors of a company must hire, compensate, and terminate the public accounting firm that audits the company's financial reports. C. Severe penalties are established for altering or destroying documents that may eventually be used in an official proceeding. D. Both the CEO and CFO must certify in writing that their company's financial statements and accompanying disclosures fairly represent the results of operations. 10. With the enactment of the Sarbanes-Oxley Act of 2002, all public companies are now required by the SEC to disclose in their annual reports whether or not their chief financial executives are covered by a company-imposed: A. Board of Directors subcommittee. B. Human Resource guidelines. C. Code of Ethics. D. All of the above. E. None of the above.

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