iggy, owner of Jaguar Security Agency offers security services unto Honest Industries Co. of which his father Joe Calida sits as member of the Board of Directors. What are the requirements for the contract to be declared valid by the Board?
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Jiggy, owner of Jaguar Security Agency offers security services unto Honest Industries Co. of which his father Joe Calida sits as member of the Board of Directors. What are the requirements for the contract to be declared valid by the Board?
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- Robert is the CEO of a closely held business, and he would like to provide life insurance to all of his employees as a fringe benefit. Robert would like life insurance that permits him to pay the premium, so long as it is deductible as a business expense and permits the employee to designate the beneficiary of the policy. Which one of the following is the most appropriate insurance product for Robert's situation? A)Robert should enter into an entity buy-sell agreement with each employee using cash value life insurance. B)Robert should provide group term life insurance. C)Robert should provide key person life insurance. D)Robert should provide split-dollar life insurance.In the following case, identify all the violations of the rules of conduct of the Code of Professional Ethics, indicate the rule and explain why it was violated. Carmen and Carlos formed a corporation called CPA al servicio. 50% of all issued shares are divided between the two owner shareholders. Carmen in CPA and member of the AICPA Carlos is an appraiser. They announce themselves as members of the AICPA. They were hired to do an audit, the payment of which will be based on the findings of the CPA. Carmen commented with another CPA colleague on important aspects of the case to be audited. During the audit Carmen found deviations from the Generally Accepted Accounting Principles. Carmen gave an opinion in the report of her "unqualified without qualification."102 Integrity and objectivity } 201 General standards } 202 Compliance with standards } 203 Accounting Principles } 301 Confidential customer information } 302 Contingency expenses } 501 Acts of discredit } 502 Promotion or…Dr. John Holm signed a two-year employment agreement with Gateway Anesthesia Associates, PLLC. During negotiations for the agreement, Gateway’s president, Dr. Jon Nottingham, told Holm that on comple-tion of the contract he would become a partner in the firm and that during the term he would be paid “like a partner.” The written agreement did not reflect this promise—the con-tract read that Holm would be paid based on “net collections” for his services and did not state that he would become a part-ner. Later, Gateway told Holm that it did not intend to make him a partner. Holm filed a complaint in an Arizona state court against Gateway, alleging breach. Before the trial, Holm filed a motion to reform the contract to express what he had been told. Nottingham did not dispute Holm’s account. What is the basis for the reformation of a contract? Is it appropri-ate in this case? Why or why not?
- Howard Beale, a member, uses Outsource Inc., a third-party service provider, to assist him in furnishing bookkeeping and tax work for his clients. This necessitates Howard Beale disclosing confidential client information to Outsource Inc. Howard Beale is not a California licensee, and he practices outside of California. In addition to informing his clients that he is using a third- party service provider which of the following is required with respect to the release of such information? Prior to using Outsource Inc.'s services, Howard Beale enters into a contractual agreement with Outsource Inc. to maintain the confidentiality of the information, and Howard Beale is reasonably assured that Outsource Inc. has procedures that will prevent unauthorized release of the information. ) Specific client consent is obtained prior to releasing the information to Outsource Inc. ) The client must contact Outsource, Inc. to ensure that their confidential information will not be disclosed. )…What kind of support will Salem provide to his company for the professional accountants ethics code?Faith Battle operates a health food store, and she has beenthe only employee. Her business is growing, and she is consideringhiring some additional staff to help her in the store.Explain to her the various payroll deductions that she willhave to account for, including their potential impact on herfinancial statements, if she hires additional staff.
- In one of the following situations, the member acted properly. Which one? Group of answer choices a. Joe was providing consulting services to client Lowery Company and in that capacity learned trade secrets that he used to convince Richter Corporation to hire him as a consultant who could help Richter compete against Lowery. b. Fiona prepared a joint tax return for Tom and Pam, a married couple. When Tom and Pam got into a vicious divorce proceeding, Fiona helped Pam, whom she perceived to be the wronged party, and refused to share any information with Tom, whom she thought was a bad husband. c. Han prepared corporate income tax returns for Nadle Corporation until he became uncomfortable with how aggressive in seeking deductions Nadle was asking him to be. He“fired” Nadle as a client. When Nadle sought to replace Han with Jennifer, she called Han and asked: “What can you tell me about Nadle?” Han replied: “Well, I think you should ask Nadle to grant me permission to speak…In May, Parr and Presba, while in the course of negotiations with Barker (a salesperson for Quaker Hill) to purchase plants and flowers, undertook to organize a corporation to be named the Denver Memorial Nursery, Inc. On May 14 and 16, Parr signed two orders on behalf of Denver Memorial Nursery, Inc., which, to the knowledge of Quaker Hill, was not yet formed, that fact being noted in the contract. A down payment in the amount of $1,000 was made. The corporation was not formed prior to entering into the contract because Quaker Hill insisted that the deal be concluded at once since the growing season was rapidly passing. Under the contract, the balance of the purchase price was not due until the end of the year. The plants and flowers were shipped immediately and arrived on May 26. The Denver Memorial Nursery, Inc., was never formed. Quaker Hill seeks to recover the unpaid balance of the purchase price from Parr and Presba. a. What are the arguments that Parr and Presba are personally…Which of the following people would not be considered an “Other Member” (OM) for Code of ProfessionalConduct purposes? Group of answer choices a. Tim, who has his CPA license, but is currently unemployed and traveling around the country living off his savings. b. Bolt, who has his CPA license, but is trying out retirement to see if it suits him. c. Margot, who has her CPA license, but is unemployed as she is devoting most of her time topursuing a sexual harassment lawsuit against her previous firm. d. Ananya, who has her CPA license and is an internal auditor for Frisbye Corporation.
- Suppose you are a CPA hired to represent a client who is currently under examination by the IRS. The client is the president and 95% shareholder of a building supply sales and warehousing business. He also owns 50% of the stock of a construction company. The client's son owns the remaining 50% of the construction company's stock. The client has received a notice of proposed adjustments (NPA) on three significant issues related to the building supply business for the years under examination. The issues identified in the NPA are unreasonable compensation, stock redemptions, and a rental loss. Additional facts regarding the issues are reflected below: Stock redemptions: During the audit period, the construction company redeemed 50% of the outstanding stock owned by the client and 50% of the stock owned by the client's son, leaving each with the same ownership percentage of 50%. The IRS treated the redemption as a distribution under IRC Section 301. Create a tax plan. Use Section 301 of…Suppose you are a CPA hired to represent a client who is currently under examination by the IRS. The client is the president and 95% shareholder of a building supply sales and warehousing business. He also owns 50% of the stock of a construction company. The client's son owns the remaining 50% of the construction company's stock. The client has received a notice of proposed adjustments (NPA) on three significant issues related to the building supply business for the years under examination. The issues identified in the NPA are unreasonable compensation, stock redemptions, and a rental loss. Additional facts regarding the issues are reflected below: Stock redemptions: During the audit period, the construction company redeemed 50% of the outstanding stock owned by the client and 50% of the stock owned by the client's son, leaving each with the same ownership percentage of 50%. The IRS treated the redemption as a distribution under IRC Section 301. Develop a research-based and ethical…Suppose you are a CPA hired to represent a client who is currently under examination by the IRS. The client is the president and 95% shareholder of a building supply sales and warehousing business. He also owns 50% of the stock of a construction company. The client's son owns the remaining 50% of the construction company's stock. The client has received a notice of proposed adjustments (NPA) on three significant issues related to the building supply business for the years under examination. The issues identified in the NPA are unreasonable compensation, stock redemptions, and a rental loss. Additional facts regarding the issues are reflected below: Stock redemptions: During the audit period, the construction company redeemed 50% of the outstanding stock owned by the client and 50% of the stock owned by the client's son, leaving each with the same ownership percentage of 50%. The IRS treated the redemption as a distribution under IRC Section 301. Establish when stock redemption is…