MEMPHIS ACCT 3130 M50/ACCT 3130 M50 FALL 2015 ONLINE FINAL EXAM 2015 (PERFECT ANSWER) 51 QUESTIONS
1. Reference: “Divorce fallout.” Dr. Fred, following a messy divorce, has encountered significant financial difficulties. Dr. Fred has a friend named Slick Slim who tells Dr. Fred that he has been making lots of money by selling people a wristband that allegedly places pressure on a nerve that signals hunger resulting in a lack of appetite. Slick Slim tells Dr. Fred that, although the device does not really work, people who want to lose weight and look good in their bathing suits will do anything and that it sells like hotcakes. Slick Slim tells Dr. Fred that he will pay Dr. Fred five dollars for every band that Dr. Fred can sell to his patients. Dr. Fred proceeds to mail letters to patients suggesting the use of the band for weight loss. He also uses UPS to mail samples of the band to some patients along with letters encouraging purchase of the bands. Dr. Fred then proceeds to bill Medicare for office consultations he has with patients when they come in to purchase the bands. The scheme is wildly successful. Dr. Fred is able to entirely satisfy his alimony obligations within just a few months. Unfortunately, as patients begin to see that they are not having any weight loss, he has been receiving numerous complaints, and a friend of his told him that he could even be facing some criminal prosecution. By which of the following acts, if any, did Dr. Fred commit healthcare fraud?
By the receipt of kickbacks from Slick Slim only.
Dr. Fred did not commit any acts of healthcare fraud.
By the submission of false claims to Medicare only.
By submitting false claims to Medicare, by receiving kickbacks from Slick Slim, and also by merely discussing the matter with Slick Slim.
By the submission of false claims to Medicare and also by the receipt of kickbacks from Slick Slim.
2. Which of the following is the misappropriation of trust funds or money held in a fiduciary capacity?
Pretexting
Ponzi scheme
False pretenses
False entries
Defalcation
3. Billy knows that he can bring his case against Bob in a state court in Tennessee. He is unsure, however, of which county in which to proceed. Which of the following address the proper county?
Diversity jurisdiction
In personam jurisdiction
Venue
Subject-matter jurisdiction
Long-arm jurisdiction
4. Reference: “Employment law.” Clare, who has a successful pet grooming business, is planning to expand her operations from the U.S. into Canada and perhaps Mexico. A friend of hers, Bill, told her that she should carefully investigate the laws in those countries before she proceeded. Clare responded, however, that she was not concerned because by international treaty, and under NAFTA, so long as she is a U.S. citizen, she only has to obey U.S. laws. Laws of other countries would not apply to her business operations. Clare also replied that any other country would have the same strict employment-at-will standard as exists in the U.S. She tells him the employment-at-will standard is very strict and has not changed over the years, and that the nature of the relationship between employer and employee has remained unchanged. What concept is Clare referencing when she mentions employment-at-will?
The requirement that employers allow employees to take breaks at will after six hours of work.
The right of the employer or the employee to terminate the employment relationship at any time.
The requirement that employers provide safe working conditions.
The requirement that an employee give notice before quitting.
The requirement that an employer have good cause before discharging an employee.
5. Reference: “Junk food.” Mary Dogood, a member of the school board in ABC County, is appalled at the amount of junk food in the schools. She convinces the state legislature to pass an ordinance that no stores may sell any unhealthy, junk food within 500 feet of any school or day care center. A teacher of political science raises the issue of whether the regulation is valid and is told that it is a valid exercise of the jurisdiction’s police power to protect its citizens. Convenience stores balk at the regulation and challenge it in court. What do courts generally presume regarding laws passed in accordance with states’ police power?
There is no presumption.
The law is valid.
The law is invalid.
The law is valid unless it involves the commerce clause.
The law is valid unless it involves a First Amendment right.
6. Ed goes door-to-door selling magazine subscriptions. Ed knows, however, that he is simply taking money for subscriptions and has absolutely no intention of ever arranging for the provision of magazines. Which of the following offenses, if any, has he committed?
False token
False entry
Ponzi scheme
False pretenses
Defalcation
7. Which of the following is an international agreement?
A written agreement made between states governed by international law and relating to international subject matter.
A general and consistent practice by states regardless of whether the practice is accepted as law.
A general and consistent practice by states that is accepted as law.
An agreement that is only between two states, not three or more relating to an international subject matter.
An agreement that is made between at least three states regarding an international subject matter.
8. If a contract does not provide for arbitration, parties may submit a specific dispute involving a contractual provision to arbitration through the use of a ______.
Suggested ADR resolution clause
Submission agreement
Binding arbitration clause
The parties may not submit a specific dispute to arbitration if the contract does not provide for arbitration.
Binding mediatory clause
9. Over which of the following does the federal court system have exclusive jurisdiction?
Admiralty cases only
Copyright cases only
None of the above
Admiralty, bankruptcy, and copyright cases
Bankruptcy cases only
10. Reference: “Environmental Concerns.” Connie, the president of a company that makes paper, has a new interest in the environment. She recently went to a seminar on environmental dangers and has decided to take steps to clean things up. She started at home and has now felt compelled to change things at work. Connie had to face the fact that her company has been cheating and is not in compliance with applicable environmental regulations due to dumping in the nearby river. Her company has never been cited because it employs a very large number of people in the community, including the mayor’s wife and the chief-of-police’s brother. On her mission to clean things up, Connie has decided to go even further than the law requires and install the very latest environmental protections. When she announced her plan, the chair of the company’s board of directors, Brooke, had a meeting with Connie. Brooke told Connie to analyze the situation carefully because the cost of the additional equipment would mean no dividend to shareholders and no raise for employees. Furthermore, Brooke told Connie that installing all the new equipment would result in higher prices for the company’s paper produce and could bankrupt the company because of foreign competition. Brooke hinted that Connie could be fired if she persisted. Brooke suggested that Connie just be concerned with a minimal standard of ethics.
Which of the following is the minimal standard that a business must meet in a consideration of business ethics suggested by Brooke?
Decisions must meet the criteria of a follower of deontology.
Decisions must be legal and decisions must receive a majority vote of acceptance by employees.
Decisions must be legal.
Decisions must meet the criteria of a follower of utilitarianism.
Decisions must receive a majority vote of acceptance by employees.
11. Which of the following is a type of ADR?
Mediation
Consultation
Case argument
Focus grouping
Case analysis
12. Assume a businessperson who owns a computer equipment store is delinquent in paying rent to the landlord. The resulting dispute focuses on ______law.
Private
Preferential
Consensual
Public
Black letter
13. When may government agents search without a search warrant?
All of the above.
When they can show that a felony is involved.
When they can show that the suspect who lives in the residence at issue has been in jail previously.
When law enforcement officials believe it likely that the items sought will be removed before they can obtain a warrant.
Outside of normal working hours for a judge.
14. What do the letters “WPH” mean in reference to the “WPH Framework for Business Ethics” discussed in the text?
Where, Procedure, and How
When, Plan, and How
Where, Plan, and Hope
Why, Procedure, and Hope
Who, Purpose, and How
15. Assuming the requisite elements are proven, which of the following is a defense when it is established that a crime is committed because the person committing the act was threatened with immediate bodily harm or loss of life unless the offense was committed?
Duress.
Entrapment.
Necessity.
Justifiable use of force.
Inescapable action.
16. Which of the following is the forceful and unlawful taking of personal property?
Larceny
Criminal fraud
Burglary
Arson
Robbery
17. Reference: “Accounting Advice.” Brad, a newly hired Certified Public Accountant, who barely passed his boards, was asked by a business client, a chief executive officer, about the effect of the Sarbanes-Oxley Act on an accounting issue. Brad assured the client that the client should not be concerned about the Act because it is very vague, unspecific, and difficult to understand. Brad told the CEO that in any event, the CEO could not be held personally responsible regardless of what happened because only company business was involved. Brad also told the CEO that there is no oversight involved with the act. Later that same day, a coworker of Brad discovered that the CEO had been involved in misstating some financial reports and had also destroyed financial documents to cover up fraud. An employee at the company, Laura, had informed the coworker. When the issue was mentioned to the CEO, he immediately fired Laura. Which of the following is true regarding the Act and Laura’s firing?
The act provides protection for whistle-blowers only if it can be shown that a significant amount of money, in excess of $10,000, was involved in any misstatement.
The act provides protection for whistle-blowers only if it can be shown that a significant amount of money, in excess of $5,000, was involved in any misstatement.
The act does not provide protection for whistle-blowers such as Laura.
The act provides protection for whistle-blowers who work for an accounting firm, but not for any other employees.
Laura’s whistle-blowing would be protected under the act, and her firing was illegal.
18. The idea that we should interact with other people in a manner consistent with the manner in which we would like them to interact with us is called the ______.
Equalization Rule
Ten Commandments Rule
Silver Rule
Golden Rule
Ethical Realization Rule
19. Which of the following serves to combat bribery of foreign officials?
The Foreign Official Bribery Act
The Foreign Corrupt Practices Act
The International Bribery Prohibition Act
The Fair Business Act
The International Fair Business Practices Act
20. Reference: “Revenge.” Jane, a first year law student, while walking to school in inclement weather, accidentally slipped on ice knocking down Greg, another first year law student, breaking his glasses. He was very angry with Jane and let the air out of one of her car tires. Greg also decided to sue Jane for negligence claiming as damages $300 for his broken glasses. He decided that he already knew all about the law and did not need a lawyer. Greg sued Jane in state court. Jane, in the same lawsuit, brought an action against Greg for letting the air out of her tire. At the trial in state court, Jane told the judge that a friend, Susie, told her that she saw Greg let the air out of Jane’s tire. The judge disallowed Jane’s testimony on that issue. Susie, however, who was in the courtroom also came and testified to that effect. The state court judge ruled in favor of Jane. Greg said that he was not giving up and that he would seek double damages on appeal in federal court. Jane and Greg live in different states when not attending school. After the trial, Jane reported Greg’s actions of letting the air out of her tire to the police who said that they would proceed with a criminal action against Greg. Jane’s action against Greg for the tire is called a[n] ______.
Counterclaim
Discovery claim
Third party claim
Cross-claim
Service claim
21. Reference: “The Stolen Book.” Susan is told by Betty that Bob stole her business law book out of her car. The next day Susan confronts Bob and slaps him for stealing her book. Bob had Susan arrested for slapping him. Susan sues Bob for damages to the amount of the book and for maliciously having her arrested. Claiming that she lied, Bob sues Betty for defamation. The lawsuit Susan has against Bob for damages for stealing her book involves which of the following?
Administrative law
Comprehensive law
Private law
Public law
Both public and private law
22. According to the ______ Amendment to the Constitution, all powers that the Constitution neither gives exclusively to the federal government nor takes from the states are reserved for the states.
Second
Sixth
First
Fifth
Tenth
23. Reference: “Cosmetic profits.” Sally is the vice president at Big Name Cosmetics company. She learns that the company is soon going to purchase a smaller chain of stores. It is expected that stock in Big Name Cosmetics will rise dramatically at that point. Sally immediately buys a number of shares of her company’s stock. She also tells her friend Alice about the expected purchase of stores. Alice wanted to purchase stock in the company but lacked the funds with which to do so. Although she did not have the funds in Bank A, Alice decided to draw a check on Bank A and deposit the check in Bank B and then proceed to write a check on Bank B to cover the purchase of the stock. She hoped that she would have sufficient funds to deposit before the check was presented for payment. Of which of the following, if any, is Sally guilty of by providing information to Alice regarding the purchase?
She is guilty of an insider trading violation by being tipped.
She is guilty of criminal extortion.
She is guilty of an insider trading violation by tipping the information.
She is guilty of an insider trading violation by both tipping and being tipped.
She is not guilty of any offense.
24. At trial, a defense lawyer states that evidence should not be admitted because it is “fruit of the poisonous tree.” Upon which of the following is the attorney relying?
The Eve Rule.
The exclusionary rule.
The Eden Rule.
The Fourth Amendment Rule.
The Adam Rule.
25. Which type of legal system exists in North Korea?
Socialist legal system
Asian legal system
Common law legal system
Islamic legal system
Civil legal system
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