Smith, CPA, Has Been Asked to Issue a Review Report

question 920

Multiple Choice

Smith, CPA, has been asked to issue a review report on the balance sheet of Cone Company, a nonissuer, and not on the other related financial statements. Smith may do so only if:

• A) Smith compiles and reports on the related statements of income, retained earnings, and cash flows.
• B) Smith is not aware of any material modifications needed for the balance sheet to conform with GAAP.
• C) The scope of Smith's inquiry and analytical procedures is not restricted.
• D) Cone is a new client and Smith accepts the engagement after the end of Cone's fiscal year.

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Definitions:

Determinism

The philosophical belief that all events, including moral choices, are determined completely by previously existing causes, implying that free will is an illusion.

Mental Terms

Language or vocabulary related to psychological states, processes, disorders, or treatments.

B. F. Skinner

An American psychologist and behaviorist known for his work in developing the theory of operant conditioning, which uses consequences to modify the occurrence and form of behavior.

Evolution

The process by which different kinds of living organisms are thought to have developed and diversified from earlier forms during the history of the earth.