Q32. A shareholder receives a distribution that exceeds the shareholder’s stock basis, and AAA is positive. The excess over stock basis is treated as: A. Capital gain B. Ordinary income C. No income D. Section 1231 gain

Q4. A corporation wants to match income allocations to economic reality after a mid-year S-termination. Which method allows non-pro rata allocations? A. Specific-ID with unanimous consent B. Daily proration C. FIFO share tracing D. Weighted-basis allocation

Q14. A shareholder has zero stock basis and $9,000 remaining debt basis. The S-corp allocates a $26,000 ordinary loss, and the shareholder is fully at risk. How much of the loss is deductible under basis rules? A. $0 B. $9,000 C. $17,000 D. $26,000

Managers’ Response to a New Standard: In 2004, the Financial Accounting Standards Board (FASB) revised SFAS 123 to mandate the expensing of employee stock option grants, but firms had until 2006 to adopt the mandate. The delay between the passage of the new rule and its mandated adoption date provided managers with the opportunity to take two very different paths. The first path was the acceleration of the vesting of executive stock options prior to the SFAS 123R effective date (accelerators), which reduced the number of options the firms had to expense after the SFAS 123R mandatory adoption date. Managers took this path to avoid reporting lower earnings after the SFAS 123R mandatory adoption date. An alternative path was the early adoption of SFAS 123R, whereby managers started to recognize the expenses associated with SFAS 123R earlier than required (early-adopters).  An academic study found evidence that in the period before early adoption, there were no significant differences in audit fees across the two groups of firms – early-adopters and accelerators. However, following the early adoption period, audit fees were significantly lower for early adopters, and significantly higher for accelerators. Further, the study documented significant positive abnormal returns at the early adoption announcements and significant negative abnormal returns at the acceleration announcements. Required: Using your knowledge of capital markets, explain why a company’s reporting choices around this new standard could impact audit fees and stock prices.    

Auditor independence has been an ongoing concern for US regulators such as the SEC and the PCAOB, who believe that the auditor’s provision of non-audit services could compromise auditor independence. Using any evidence from academic research covered in your class readings, discuss whether the regulators’ concern is warranted?

Which facility type generally houses individuals awaiting trial or serving short sentences?

Explain the purpose of bail in the criminal justice system. Include why bail is used, what problem it attempts to solve, and how it relates to the presumption of innocence.

Which level of law enforcement includes agencies such as the FBI, DEA, and ATF?

Which of the following is a primary purpose of corrections in the United States?

Parole conditions may include reporting requirements, treatment participation, and drug testing.