It Is Normal Practice to Verify All Capital Stock Transactions

question 17

Multiple Choice

It is normal practice to verify all capital stock transactions

• A)that are in excess of a material amount.
• B)if there aren't very many during the year.
• C)regardless of the controls in existence,because of their materiality and permanence in the records.
• D)only when the client is small.

Evaluate the value of rough estimates of probability distribution of project NPV or IRR over point estimates.

Understand and apply scenario and decision tree analysis in capital budgeting.

Recognize the significance of options in capital budgeting including expansion, abandonment, and timing options.

Distinguish between different types of analysis including scenario, sensitivity, and simulation analyses in evaluating project variables.

---

Definitions:

Enforce

To compel adherence to a law, rule, or agreement through the use of authority or power.

Exchanged Promise

An agreement where two parties make reciprocal promises to perform certain actions or obligations.

Consideration

Consideration is something of value exchanged between parties in a contract that makes the agreement legally binding.

Ethical Obligation

A moral responsibility to act in accordance with ethical principles.