The Code of Professional Conduct Is Established by the Membership

question 32

Multiple Choice

The Code of Professional Conduct is established by the membership of the AICPA, and the Interpretations of the Rules of Conduct are prepared by the

• A) Financial Accounting Standards Board.
• B) Securities and Exchange Commission.
• C) CPA licensing agencies within each state.
• D) Professional Ethics Executive Committee of the AICPA.

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Definitions:

Accounts Payable

Liabilities owed by a company to creditors for goods and services received but not yet paid for.

Capital Stock

The total number of shares that a corporation is authorized to issue as stated in its corporate charter.

Assets

Economic resources controlled by a business from which future economic benefits are expected to flow to the business.

Liabilities

These are obligations a business owes to external parties, including loans, accounts payable, mortgages, and other debts.