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:

Job-Order Costing

An accounting methodology used for tracking the production costs (materials, labor, and overhead) of custom products or jobs, allowing for detailed monitoring and costing of individual orders.

Ending Balance

The final amount in an account at the end of an accounting period after all debits and credits are accounted for.

Overapplied Overhead

This occurs when the overhead costs allocated to products or jobs exceed the actual overhead costs incurred.

Manufacturing Overhead

includes all production costs other than direct materials and direct labor, such as indirect materials, indirect labor, and factory-related expenses.