The purpose of an audit is to ensure that financial statements have been prepared according to
A) the particular company's standards.
B) the industry's standards.
C) generally accepted accounting principles.
D) international accounting standards.
E) the standards of certified public accountants.
Question 2 - Punishment is often thought to do more harm than good. However, the advantage of using punishment in this situation is that it could motivate the employee to start showing up at work on time. The disadvantages of punishment are often an unpleasant environment, hostility and resentment, and the possibility that the behavior is suppressed for a short period only to return at a later time.
Question 3 - Identify and explain two advantages and two disadvantages of sole proprietorships.
Question 4 - Darrell inherited a large amount of money from his uncle. Darrell wishes to start his own business, and his lawyers encourage him to make it a corporation. What disadvantage of a sole proprietorship are the lawyers trying to avoid?
A) Unlimited liability
B) Lack of management skills
C) Retention of all profits
D) Lack of money
E) Double taxation
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