LSB Exam 4 Updated ACTUAL
QUESTIONS AND CORRECT ANSWERS
The most common type of _______ are brokerage firms, referred to as broker-dealers that
buy and sell securities on behalf of a client. - CORRECT ANSWER Intermediaries
If an employer does offer retirement benefits, they are typically offered in the form of a
_______ or through a tax-deferred retirement savings account. - CORRECT
ANSWER Pension
Which of the following is not a factor considered when classifying an employee as covered or
exempt? - CORRECT ANSWER Whether the employee uses the employer's tools or
his or her own.
The Fair Labor Standards Act was originally intended to cover employers engaged in: -
CORRECT ANSWER Interstate commerce only.
Security transactions involving the original issuance and reissuance of securities by a
business to raise capital are called the: - CORRECT ANSWER Primary Market
Under Sarbanes-Oxley, requiring the payback of corporate bonuses that were awarded and
later found to be based on false disclosures is called a ______ provision. - CORRECT
ANSWER Clawback
The FLSA cannot be properly understood without reference to two major historical events
that occurred during the earlier parts of the twentieth century: - CORRECT
ANSWER Industrial Revolution and the Great Depression
Investors seek a return from their investment based on the ______ if the security. -
CORRECT ANSWER Value
Under the Health Care and Education Reconciliation Act, employers offering high-end health
care policies in 2018 will be required to pay additional taxes to help fun the Act's plan. A high
, end health care policy is defined as one costing more than: - CORRECT
ANSWER $27,500 per year.
Fundamentally, an agency transaction involves creation of agency, performance of obligation
and duties, and - CORRECT ANSWER Termination of agency.
The IRS has developed a three prong test to determine an agents status. Which of the
following is not a prong in the test? - CORRECT ANSWER Whether the working
relationship is written or real.
While substantial portions of the Sarbanes-Oxley Act are aimed at solving specific
mechanism failures in auditing and other accounting procedures, the law also imposes higher
levels of _______ responsibility for those involved in corporate governance. - CORRECT
ANSWER Fiduciary
The public outcry over the Enron scandal and waning public confidence in the oversight of
financial frauds in the market led _______ to pass several laws to improve the quality of
financial disclosure by public corporations. - CORRECT ANSWER Congress
A public outcry and a growing lack of investor confidence in corporate financial disclosures
caused Congress to overhaul the entire corporate governance regulatory structure by passing
the: - CORRECT ANSWER Sarbanes-Oxley Act of 2002
What caused a stunning reversal and ordered retrial by the US Supreme Court in Arthur
Andersen LLP v. United States, of Andersen's conviction in 2005? - CORRECT
ANSWER Improper jury instructions.
One of the most important aspects of New Deal legislation was the enactment of various
employment laws, one of which was the: - CORRECT ANSWER Fair Labor Standards
Act
Which of the following is not covered under the Fair Labor Standards Act? - CORRECT
ANSWER Working conditions.
QUESTIONS AND CORRECT ANSWERS
The most common type of _______ are brokerage firms, referred to as broker-dealers that
buy and sell securities on behalf of a client. - CORRECT ANSWER Intermediaries
If an employer does offer retirement benefits, they are typically offered in the form of a
_______ or through a tax-deferred retirement savings account. - CORRECT
ANSWER Pension
Which of the following is not a factor considered when classifying an employee as covered or
exempt? - CORRECT ANSWER Whether the employee uses the employer's tools or
his or her own.
The Fair Labor Standards Act was originally intended to cover employers engaged in: -
CORRECT ANSWER Interstate commerce only.
Security transactions involving the original issuance and reissuance of securities by a
business to raise capital are called the: - CORRECT ANSWER Primary Market
Under Sarbanes-Oxley, requiring the payback of corporate bonuses that were awarded and
later found to be based on false disclosures is called a ______ provision. - CORRECT
ANSWER Clawback
The FLSA cannot be properly understood without reference to two major historical events
that occurred during the earlier parts of the twentieth century: - CORRECT
ANSWER Industrial Revolution and the Great Depression
Investors seek a return from their investment based on the ______ if the security. -
CORRECT ANSWER Value
Under the Health Care and Education Reconciliation Act, employers offering high-end health
care policies in 2018 will be required to pay additional taxes to help fun the Act's plan. A high
, end health care policy is defined as one costing more than: - CORRECT
ANSWER $27,500 per year.
Fundamentally, an agency transaction involves creation of agency, performance of obligation
and duties, and - CORRECT ANSWER Termination of agency.
The IRS has developed a three prong test to determine an agents status. Which of the
following is not a prong in the test? - CORRECT ANSWER Whether the working
relationship is written or real.
While substantial portions of the Sarbanes-Oxley Act are aimed at solving specific
mechanism failures in auditing and other accounting procedures, the law also imposes higher
levels of _______ responsibility for those involved in corporate governance. - CORRECT
ANSWER Fiduciary
The public outcry over the Enron scandal and waning public confidence in the oversight of
financial frauds in the market led _______ to pass several laws to improve the quality of
financial disclosure by public corporations. - CORRECT ANSWER Congress
A public outcry and a growing lack of investor confidence in corporate financial disclosures
caused Congress to overhaul the entire corporate governance regulatory structure by passing
the: - CORRECT ANSWER Sarbanes-Oxley Act of 2002
What caused a stunning reversal and ordered retrial by the US Supreme Court in Arthur
Andersen LLP v. United States, of Andersen's conviction in 2005? - CORRECT
ANSWER Improper jury instructions.
One of the most important aspects of New Deal legislation was the enactment of various
employment laws, one of which was the: - CORRECT ANSWER Fair Labor Standards
Act
Which of the following is not covered under the Fair Labor Standards Act? - CORRECT
ANSWER Working conditions.
