An Attestation Engagement Is One in Which a CPA Is

question 20

Multiple Choice

An attestation engagement is one in which a CPA is engaged to

• A) Issue a report on subject matter or an assertion about the subject matter that is the responsibility of another party.
• B) Provide tax advice or prepare a tax return based on financial information the CPA has not audited or reviewed.
• C) Testify as an expert witness in accounting, auditing, or tax matters, given certain stipulated facts.
• D) Assemble prospective financial statements based on the assumptions of the entity's management without expressing any assurance.

Identify the proper accounting treatment for dividends and interest received from investments.

Determine the accounting methods appropriate for different levels of ownership in another company's stock.

Distinguish between the cost method and equity method of accounting for long-term investments.

Calculate and record the initial cost of purchasing stock, including related fees.

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Definitions:

Activity Durations

The individual time periods that each task or activity within a project is expected to take from start to completion.

Critical Path Analysis

A process to find the most effective sequence of activities that helps determine a project schedule.

PERT

A method for project management, the Program Evaluation and Review Technique is utilized to plan, organize, and manage the tasks associated with a project.

CPM

Stands for Critical Path Method; a step-by-step project management technique for process planning that defines critical and non-critical tasks.