Due Diligence, in Essence, Means a Tax Practitioner

question 34

Multiple Choice

Due diligence, in essence, means a tax practitioner:

• A)must be efficient in performing his duties
• B)must give due respect toIRS officials
• C)should use reasonable effort tocomply with the tax laws
• D)should charge reasonable fees for work performed for a client

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Definitions:

Standard Cost

A predetermined cost of manufacturing a product or performing a service under normal conditions, used for budgeting and performance evaluation.

Direct Labour

The wages paid to workers who are directly involved in the manufacturing of products or providing services.

Standard Variable Overhead Rate

is a predetermined rate used to allocate variable overhead costs to each unit of production based on a particular activity, such as labor hours.

Ideal Standards

Standards that assume perfect operating conditions with no inefficiencies, waste, or delays, used for benchmarking or motivating improvement.