Dravena Is an Accountant and She Also Regularly Dabbles in Commercial

question 43

Multiple Choice

Dravena is an accountant and she also regularly dabbles in commercial real estate investments.Recently she advised one of her accounting clients to invest in an apartment building that her and another accountant are building.Has Dravena breached any of her obligations to her client?

• A) She has breached her client's right to privilege.
• B) She has breached her duty of confidentiality.
• C) She has breached her duty to provide a reasonably competent service.
• D) She has placed herself in a conflict of interest.

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Definitions:

Interest

The cost of borrowing money, typically expressed as an annual percentage of the principal amount.

Allowance Method

An accounting technique used to account for accounts receivable that a company does not expect to collect fully, thereby creating an allowance for doubtful accounts.

Perpetual Inventory System

An inventory accounting method that instantly records inventory sales or purchases using computerized point-of-sale systems and enterprise asset management software.

Accounts Receivable

This refers to the money owed to a company by its customers for goods or services that have been delivered or used but not yet paid for.