Quentin,an Accountant,prepares for Ruff N' Reddy Concrete Corporation a Financial

question 26

Multiple Choice

Quentin,an accountant,prepares for Ruff n' Reddy Concrete Corporation a financial statement that omits a material fact.The statement is included in Ruff n' Reddy's registration statement filed with the Securities and Exchange Commission.Timor,who reads the statement,and Ubi,who does not,each buy Ruff n' Reddy stock.Under Section 11 of the Securities Act of 1933,Quentin may be liable to

• A)neither Timor nor Ubi.
• B)Timor and Ubi.
• C)Timor only.
• D)Ubi only.

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Definitions:

Predetermined Overhead Rate

A rate calculated at the beginning of a period, used to allocate overhead costs to products based on a particular activity base.

Machine-Hours

A metric assessing the amount of produced goods or operations based on machines' operation duration.

Automated Lathe

A computer-controlled machine used for shaping materials, like metal or wood, by removing excess material.

Unused Capacity

Unused capacity indicates the portion of the production capability that remains idle or is not currently being utilized.