100% Free AICPA AICPA-CPA Practice Test Questions

Question 1

Trinket Corporation is being sued by its distributor, International, for nonpayment of debts. International will be able to hold Jasper Crumb, a shareholder of Trinket, personally liable for the company's debts if:

A : Trinket Corporation is overcapitalized.

B : The shareholder's personal assets are materially commingled with Trinket's assets.

C : Trinket's articles of incorporation allow for more than one class of stock.

D : Trinket has four shareholders, including Jasper Crumb.

Answer: B

Question 2

Which of the following requires filing a gift tax return if the transfer exceeds the available annual gift tax exclusion?

A : Medical expenses paid directly to a physician on behalf of an individual unrelated to the donor.

B : Tuition paid directly to an accredited university on behalf of an individual unrelated to the donor.

C : Payments for college books, supplies, and dormitory fees on behalf of an individual unrelated to the donor.

D : Campaign expenses paid to a political organization.

Answer: C

Question 3

The target capital structure of Cerberus Co. is 50% debt, 10% preferred equity, and 40% common equity. The interest rate on debt is 8%, the yield on the preferred is 10%, the cost of common equity is 12%, and the tax rate is 40%. Cerberus does not anticipate issuing any new stock. What is Cerberus' weighted-average cost of capital?

A : 7.40%

B : 8.20%

C : 9.00%

D : 9.80%

Answer: B

Question 4

Trinket Corporation is being sued by its distributor, International, for nonpayment of debts. International will be able to hold Jasper Crumb, a shareholder of Trinket, personally liable for the company's debts if:

A : Trinket Corporation is overcapitalized.

B : The shareholder's personal assets are materially commingled with Trinket's assets.

C : Trinket's articles of incorporation allow for more than one class of stock.

D : Trinket has four shareholders, including Jasper Crumb.

Answer: B

Question 5

Identify the correct statement regarding analytical procedures used in a review conducted at the conclusion of an audit.

A : The ultimate purpose of analytical procedures used in a review conducted at the conclusion of the audit is to uncover fraud schemes that may have been missed previously during the audit.

B : Typically, a junior member of the engagement team will perform the analytical procedures applied at the conclusion of the audit because less precision is required.

C : If review analytical procedures suggest the presence of misstated account balances, the auditor may have to perform additional substantive tests of details to satisfactorily complete the audit.

D : Analytical procedures used in the review near the conclusion of the audit are not required.

Answer: C

Free Practice AICPA AICPA-CPA Exam Questions 2025