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VCE
Which of the following is not an example of the application of professional skepticism?
A. Designing additional auditing procedures to obtain more reliable evidence in support of a particular financial statement assertion.
B. Obtaining corroboration of management's Explanation: s through consultation with a specialist.
C. Inquiring of prior year engagement personnel regarding their assessment of management's honesty and integrity.
D. Using third party confirmations to provide support for management's representations.
A perfectly inelastic supply curve in a competitive market:
A. Means the equilibrium price must be zero.
B. Implies a vertical demand curve.
C. Exists when firms cannot vary input usage.
D. Says the market supply curve is horizontal.
DAC Foundation awarded Kent $75,000 in recognition of lifelong literary achievement. Kent was not required to render future services as a condition to receive the $75,000. What condition(s) must have been met for the award to be excluded from Kent's gross income?
I. Kent was selected for the award by DAC without any action on Kent's part.
II.
Pursuant to Kent's designation, DAC paid the amount of the award either to a governmental unit or to a charitable organization.
A.
I only.
B.
II only.
C.
Both I and II.
D.
Neither I nor II.