Under Which of the Following Situations Is the Payment or Receipt

question 22

Multiple Choice

Under which of the following situations is the payment or receipt of a commission by a public accountant (PA) permissible?

• A)A PA has a lawyer for an audit client;each time the lawyer helps the PA by referring a new client,the PA pays the lawyer a $1,000 referral fee.
• B)A PA performs a review of the financial statements of a client.The PA also works as a commissioned salesperson for that client.
• C)A PA has a dry-cleaning business as a client.The PA is given a 10% discount on cleaning services each time a new customer comes to the dry cleaner on the recommendation of the PA.The PA only prepares tax returns for the dry-cleaning business.
• D)An audit client that sells automobiles pays the PA $500 each time a customer that was referred to the audit client by the PA buys a car.

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Definitions:

Synaptic Vesicles

Small sacs in neurons that store neurotransmitters, which are released at the synapse during neural communication.

Terminal Buttons

The small bulblike structures at the ends of axons that release chemicals (neurotransmitters) across the synapse to communicate with other neurons.

Synapse

The junction between two neurons or a neuron and a muscle, through which nerve impulses pass.

Otto Loewi

Otto Loewi was an Austrian-German pharmacologist who won the Nobel Prize for Medicine in 1936 for his discovery of the chemical transmission of nerve impulses.