Which of the Following Statements Best Describes Circular 230

question 43

Multiple Choice

Which of the following statements best describes Circular 230?

• A)Circular 230 has been adopted by the AICPA as its set of rules of practice for CPAs.
• B)Circular 230 is a set of Treasury Department ethical and legal standards for those engaging in practice before the IRS.
• C)Circular 230 is a set of internal rules at the IRS designed toprotect tax practitioners from unfair discipline by the IRS.
• D)Circular 230 is a set of ethical rules for taxpayers.

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Definitions:

Cost of Goods Sold

The direct costs attributable to the production of the goods sold in a company, including the cost of the materials and labor directly used to create the product.

FIFO Costs

First In, First Out, a cost flow assumption for inventory valuation where the oldest inventory items are recorded as sold first.

FIFO Inventory

A method of inventory valuation where the first items placed into inventory are the first ones sold; stands for First-In, First-Out.

Periodic Inventory

An inventory accounting system where inventory counts and cost of goods sold (COGS) are determined at the end of an accounting period.