Consider the Following Short Case as You Respond to the Question

question 60

Multiple Choice

Consider the following short case as you respond to the question: Amanda is a partner in a CPA firm; she supervises a staff of ten professionals, some of whom are already licensed CPAs and some of whom are still working toward licensure.She is responsible for audits of independent bookstores in California, Nevada and Arizona.Amanda is concerned that the less experienced professionals she supervises are repeating the mistakes she and the more experienced professionals on her team made when they began auditing.She therefore wants to create a knowledge management system.Call recommended seven steps for developing a knowledge management system, one of which relates to defining business goals.Appropriate business goals for Amanda's situation include:

• A)Hire more auditors.
• B)Cut down on relapse errors.
• C)Both hire more auditors and cut down on relapse errors.
• D)Neither hire more auditors nor cut down on relapse errors.

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Definitions:

Short Run

A time period in economics during which at least one input is fixed while others may be variable, affecting the production and costs of a business.

Long Run

In economics, the long run refers to a period in which all inputs or factors of production can be varied and no costs are fixed.

Capital Intensity Ratio

A metric that measures the amount of assets required to generate a dollar of revenue, indicating how much capital is invested in production.

Total Liabilities

The combined debts and obligations that a company or individual owes to outside parties, indicating the total amount owed.