Which of the Following Factors Most Likely Would Cause a CPA

question 491

Multiple Choice

Which of the following factors most likely would cause a CPA not to accept a new audit engagement?

• A) The prospective client's unwillingness to permit inquiry of its legal counsel.
• B) The inability to review the predecessor auditor's working papers.
• C) The CPA's lack of understanding of the prospective client's operations and industry.
• D) The indications that management has not investigated employees in key positions before hiring them.

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Definitions:

Demand Curve

A visual chart that illustrates the connection between a product's price and the amount of it consumers want to buy.

Stock Market

A marketplace where securities such as stocks and bonds are bought and sold.

Elasticity

A measure of how much the quantity demanded or supplied of a good responds to a change in one of its determinants, such as price.

Expected Utility

A theory in economics that quantifies how individuals choose between probabilistic scenarios with different outcomes, based on their predicted utility.