Preparing a Client's Tax Return Solely Based on What the Client

question 14

Multiple Choice

Preparing a client's tax return solely based on what the client has represented to you about his income and expenses generally is:

• A) Permissible
• B) Prohibited only by the AICPA's Statements of Standards onTax Practice
• C) Prohibited only by U.S. Treasury Circular 230
• D) Prohibited by both AICPA and IRS professional mandates

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Definitions:

Scanlon Plan

A type of gain-sharing program that rewards employees for contributions to productivity improvements through cost savings, emphasizing teamwork and participation.

Future Cost

Predicted financial expenditure associated with an action or decision, considering potential increases in prices or changes in resource availability.

Labour

The human effort, whether physical or mental, that is applied to the production of goods and services.

Goal-Sharing Plans

A type of incentive plan where employees are rewarded if collective goals are achieved, promoting teamwork and collaboration.