Which of the following statements is true regarding analytical techniques?
A. Ratio analysis takes advantage of economic relationships between two or more accounts.
B. Ratio trend analysis are generally carried out through a comparison of client data with expectations based on industry data, prior-period data, and expectations developed from industry trends, client budgets, and so on.
C. Developing expectations is the first step in performing analytical procedures.
D. All of the above are true.
To be reliable evidence, confirmations must be controlled by which of the following individuals?
A. A client employee responsible for accounts receivable.
B. An external auditor
C. A client's internal audit department
D. A client's controller or CFO.
An audit program is created to specify which of the following?
A. The type of audit opinion to be rendered based upon procedures performed.
B. The audit procedures that will be performed every year for the client.
C. How an auditor should think while performing audit procedures
D. Audit objectives and procedures to be followed during the audit process.
Which of the following assertions is the primary assertions is the primary assertions is the primary assertion that is satisfied by physically observing the client's count of inventory?
A. Rights
B. Valuation
C. Completeness
D. Existence
An auditor selects a sample of items recorded and traces them back (vouches) to the supporting documentation. This is an example of which of the following?
A. Directional testing for existence
B. Directional testing for completeness
C. Direct testing for valuation
D. Direct testing for rights
To satisfy the fieldwork standards, what must an auditor do?
a. Act with due care.
b. Gather sufficient appropriate evidence.
c. Be independent in mental attitude.
d. Have adequate knowledge about the client's industry.
e. All of the above.
The first general standard of the PCAOB requires that an audit be performed by which type of person?
a. Au auditor with seasoned judgment in varying degrees of supervision and review.
b. An auditor with appropriate technical training and proficiency.
c. An auditor with adequate knowledge of the standards of fieldwork and reporting.
d. An auditor satisfying the independence standards.
With a dual purpose test, what is an auditor likely to do?
A. Perform a substantive procedure concurrently with a test of control.
B. Perform a substantive procedure concurrently with a risk assessment test.
C. Perform a risk assessment test concurrently with a test of a control.
D. None of the above.
With a substantive audit strategy, what is an auditor likely to do?
A. Extensively test internal controls.
B. Limit the testing of internal controls.
C. Not access control risk.
D. Issue an adverse opinion on the financial statements.
A. Misstatements are material if they could reasonably be expected to influence the decisions of users of the financial statements.
B. Materiality guidelines are specifically prescribed by the PCAOB.
C. Materiality is not a useful concept in assessing internal control effectiveness.
D. Materiality is a concept applied to financial statement presentation but not to disclosures.
Which of the following statements about the auditing standards issues by the AICPA is true?
A. The auditing standards issued by the AICPA are no longer recognized by the PCAOB.
B. The auditing standards issued by the AICPA are no longer recognized by the profession because the AICPA voted itself out of existence.
C. The auditing standards issues by the AICPA continue to be issued by that organization for audits of public companies.
D. The auditing standards issued by the AICPA were used by the PCAOB as a starting point.
Which of the following is a reason that the auditor uses an accounting approach when performing an audit?
A. The accounting cycle approach allows the auditor to focus exclusively on either the balance sheet or the income statement.
B. COSO internal control components are based on the accounting cycles.
C. The accounting cycles provide a convenient way to break the audit up into manageable pieces.
D. The auditor needs to be able to provide an opinion related to each accounting cycle.
The Standards of the PCAOB can be broken up into three categories, i.e., general, fieldwork, and reporting. Which of the following is considered in the fieldwork standards?
a. Independence.
b. GAAP.
c. Internal control.
d. Disclosure.
The Standards of the PCAOB can be broken up into three categories, i.e., general, fieldwork, and reporting. Which of the following concepts is considered in the reporting standards?
a. Consistency in the application of accounting principles.
b. Sufficient appropriate evidence.
c. Internal control.
d. Planning and supervision.
The Standards of the PCAOB can be broken up in to three categories, i.e., general, fieldwork, and reporting. Which of the following standards is one of the general standards?
a. Training and proficiency.
b. Internal control.
c. Sufficient appropriate evidence.
d. Consistency.
Which of the following factors affect the substantive procedures performed in an audit?
a. The subjectivity of accounting process.
b. Size of the account.
c. Effectiveness of the relevant controls.
d. All of the above affect the substantive procedure that are performed.
Which of the following is not a planning procedure performed to develop an audit program?
a. Determination of client company risks.
b. Determination of the audit opinion that will be rendered.
c. Development of a preliminary understanding of the quality of the client's internal control.
d. Anticipation of audit adjustments that will be required.
With a dual purpose test, what is an auditor likely to do?
a. Perform a substantive procedure concurrently with a test of a control.
b. Perform a substantive procedure concurrently with a risk assessment test.
c. Perform a risk assessment test concurrently with a test of a control.
d. None of the above.
Which of the following is a type of control that the PCAOB recommends the auditor to consider in evaluating whether or not the organization has sufficiently addressed fraud risk?
a. Controls over significant, unusual transactions, particularly those that result in late or unusual journal entries.
b. Controls over entries that relate to foreign sales.
c. Controls over related-party transactions.
d. Both A and C
e. All of the above.
With a substantive audit strategy, what is an auditor likely to do?
a. Extensively tests internal controls.
b. Limit the testing of internal controls.
c. Not assess control risks.
d. Issue an adverse opinion on the financial statements.
Which of the following items is not included in the engagement letter?
a. The responsibilities of the auditor.
b. The responsibilities of management.
c. The objective of the financial statements.
d. Identification of the applicable financial reporting framework for the preparation of the financial statements.
Which of the following statements about the AICPA is true?
a. The AIPCA is historically self-regulated.
b. The AIPCA is regulated by the federal government.
c. The AIPCA is regulated the state governments.
d. The AIPCA is a new organization established by an act of congress in 2002.
Which of the following is a use of audit documentation?
a. Assisting the engagement team in planning and performing the audit.
b. Assisting members of the engagement team responsible for supervising and reviewing the audit work.
c. Retaining a record of matters of continuing significance to future audits of the same organization.
d. All of the above.
Which of the following statements about assertions is true?
a. All assertions are equally important for all accounts.
b. The importance of an assertion depends upon the account.
c. Assertions are not related to accounts.
d. None of the above.
Which of the following is not a reason why an auditor obtains an understanding of internal controls?
a. Understanding the entity's internal control is a requirement of GAAS.
b. The auditor must use the information to assess the risk of material misstatements arising from the lack of internal control.
c. It is the primary basis for the audit report.
d. It assists the auditor in designing the nature, timing and extent of further audit procedures.
Three mitotic divisions within the female gametophyte of the megaspore produce
A) three antipodal cells, two polar nuclei, one egg, and two synergids.
B) the triple fusion nucleus.
C) three pollen grains.
D) two antipodal cells, two polar nuclei, two eggs, and two synergids.
E) a tube nucleus, a generative cell, and a sperm cell.
In flowering plants, a mature male gametophyte contains
A) two haploid gametes and a diploid pollen grain.
B) a generative cell and a tube cell.
C) two sperm nuclei and one tube cell nucleus.
D) two haploid microspores.
E) a haploid nucleus and a diploid pollen wall.
Which of the following occurs in an angiosperm ovule?
A) An antheridium forms from the megasporophyte.
B) A megaspore mother cell undergoes meiosis.
C) The egg nucleus is usually diploid.
D) A pollen tube emerges to accept pollen after pollination.
E) The endosperm surrounds the megaspore mother cell.
Which of the following statements regarding flowering plants is false?
A) The sporophyte is the dominant generation.
B) Female gametophytes develop from megaspores within the anthers.
C) Pollination is the placing of pollen on the stigma of a carpel.
D) The food-storing endosperm is derived from the cell that contains two polar nuclei and one sperm nucleus.
E) Flowers produce fruits within the ovules.
In some angiosperms, other floral parts contribute to what is commonly called the fruit. Which of the following fruits is derived mostly from an enlarged receptacle?
A) pea
B) raspberry
C) apple
D) pineapple
E) peach
Which of the following are true of most angiosperms?
A) They have a triploid endosperm within the seed.
B) They have an ovary that becomes a fruit.
C) They have a small (reduced) sporophyte.
D) They have a triploid endosperm within the seed and an ovary that becomes a fruit.
E) They have a triploid endosperm within the seed, an ovary that becomes a fruit, and a small (reduced) sporophyte.
A) Mitosis occurs in gametophytes to produce gametes.
B) Meiosis occurs in sporophytes to produce spores.
C) The gametophyte is within the flower in angiosperms.
D) Mitosis occurs in gametophytes to produce gametes, and meiosis occurs in sporophytes to produce spores.
E) Mitosis occurs in gametophytes to produce gametes, meiosis occurs in sporophytes to produce spores, and the gametophyte is within the flower in angiosperms.
A mature, unfertilized ovule in an angiosperm is the result of
A) a single meiotic division.
B) a single mitotic division.
C) both meiotic and mitotic divisions.
D) mitosis from the megaspore mother cell.
E) differentiation from the suspensor tissues.
When comparing the mature seeds of a pine tree to an apple tree, which of the following is a correct statement?
A) The developmental sequences postfertilization are identical.
B) Both contain triploid tissue.
C) The nutritive tissues are both haploid.
D) Only the apple seed has a diploid seed coat.
E) Both contain haploid and diploid tissues.
Which of the following best describes the ploidy level of a fertilized embryo sac?
A) All cells are diploid.
B) All cells are triploid.
C) All cells are polyploid.
D) The ploidy level varies among species.
E) There are haploid, diploid, and triploid cells.
Which of the following plant/animal interactions is not a mutually beneficial (mutualistic) relationship?
A) honeybees gathering pollen from apple blossoms
B) butterflies gathering nectar from lily blossoms
C) beetles feeding on magnolia blossoms
D) ants protecting and feeding from nectaries of Acacia
E) wasps such as Campsoscolia ciliata transferring pollen in orchid flowers
The male wasp, Campsoscolia ciliata, transfers pollen from one orchid to another orchid of the same species. What "reward" does the male wasp receive from the orchid plants for helping with the orchid pollination?
A) a supply of energy-rich nectar
B) volatile chemical hormones that help the male wasp find a sexually receptive female
C) no reward; the male wasp is deceived by the flower shape and odor
D) successful copulation with the flower
E) a store of nectar that the wasp can use in time of famine
The specific relationship between a legume and its mutualistic Rhizobium strain probably depends on
A) each legume having a chemical dialogue with a fungus.
B) each Rhizobium strain having a form of nitrogenase that works only in the appropriate legume host.
C) each legume being found where the soil has only the Rhizobium specific to that legume.
D) specific recognition between the chemical signals and signal receptors of the Rhizobium strain and legume species.
E) destruction of all incompatible Rhizobium strains by enzymes secreted from the legume’s roots.
Two groups of tomatoes were grown under laboratory conditions, one with humus added to the soil and one a control without humus. The leaves of the plants grown without humus were yellowish (less green) compared with those of the plants grown in humus-enriched soil. The best explanation for this difference is that
A) the healthy plants used the food in the decomposing leaves of the humus for energy to make chlorophyll.
B) the humus made the soil more loosely packed, so water penetrated more easily to the roots.
C) the humus contained minerals such as magnesium and iron, needed for the synthesis of chlorophyll.
D) the heat released by the decomposing leaves of the humus caused more rapid growth and chlorophyll synthesis.
E) the healthy plants absorbed chlorophyll from the humus.
We would expect the greatest difference in plant health between two groups of plants of the same species, one group with mycorrhizae and one group without mycorrhizae, in an environment
A) where nitrogen-fixing bacteria are abundant.
B) that has soil with poor drainage.
C) that has hot summers and cold winters.
D) in which the soil is relatively deficient in mineral nutrients.
E) that is near a body of water, such as a pond or river.
A mineral deficiency is likely to affect older leaves more than younger leaves if
A) the mineral is a micronutrient.
B) the mineral is very mobile within the plant.
C) the mineral is required for chlorophyll synthesis.
D) the mineral is a macronutrient.
E) the older leaves are in direct sunlight.
A) fungi that attack plants.
B) fungi that form mutualistic associations with roots.
C) nonphotosynthetic parasitic plants.
D) plants that capture insects.
E) plants that grow on other plants.
A) absorbing water and minerals through the fungal hyphae.
B) providing sugar to root cells, which have no chloroplasts.
C) converting atmospheric nitrogen to ammonia.
D) enabling the roots to parasitize neighboring plants.
E) stimulating the development of root hairs.
Micronutrients are needed in very small amounts because
A) most of them are mobile in the plant.
B) most serve mainly as cofactors of enzymes.
C) most are supplied in large enough quantities in seeds.
D) they play only a minor role in the growth and health of the plant.
E) only the most actively growing regions of the plants require micronutrients.
A greenhouse experiment to test growth rates in tomato cultivars was conducted using sterile soil mix and watering with sterile solutions of water and fertilizer. Following germination, half of the plants in each group were transplanted into soil that was obtained from a nearby agricultural field (nonsterile), the other half into sterile soil. After several weeks the plants that were transplanted into nonsterile soil exhibited a much higher growth rate compared to the plants transplanted into sterile soil. The most likely explanation for this result is
A) the plants transplanted into the nonsterile soil were inoculated with mycorrhizae.
B) the plants transplanted into the nonsterile soil received more fertilizer.
C) the plants transplanted into the sterile soil were stunted due to overfertilization.
D) the plants transplanted into sterile soil suffered anoxia from improper water drainage.
A group of 10 tomato plants are germinated and maintained in a large tray with no drainage. After several weeks they all begin to wilt and die despite repeated watering and fertilization. The most likely cause of this die-off is
A) competition for resources.
B) anoxia.
C) organic nutrient depletion.
D) no room left for root growth.
E) buildup of toxic substances in the tray.
You are conducting an experiment on plant growth. You take a plant fresh from the soil that weighs 5 kg. Then you dry the plant overnight and determine the dry weight to be 1 kg. Of this dry weight, how much would you expect to be made up of organic molecules?
A) 1 gram
B) 4 grams
C) 40 grams
D) 960 grams
E) 1 kg
Rhizobia, actinomycetes, and cyanobacteria all share the common feature that they can
A) increase water uptake in plants.
B) increase nutrient availability in the soil for plants.
C) kill parasites in the soil.
D) exist in extreme environments.
E) fix atmospheric nitrogen.
Rhizobia and mycorrhizae share all of the following features except
A) they both benefit by receiving carbohydrate from the plant.
B) many are host-specific.
C) they both become parasitic in nutrient-rich environments.
D) they both enhance the growth of most plants.
E) they both are found in most ecosystems of the world.