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AICPA CPA-Business Exam - Topic 3 Question 45 Discussion

Actual exam question for AICPA's CPA-Business exam
Question #: 45
Topic #: 3
[All CPA-Business Questions]

When managing cash and short-term investments, a corporate treasurer is primarily concerned with:

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Suggested Answer: D

Choice 'd' is correct. When managing cash and short-term investments, a corporate treasurer is primarily concerned with liquidity and safety.

Choice 'a' is incorrect. The board of directors and general management would be interested in maximizing rate of return on company operations.

Choices 'b' and 'c' are incorrect. The tax manager would be interested in minimizing taxes, and investing in common stock due to the dividend exclusion for federal income tax purposes.


by Loreta at May 08, 2022, 03:55 AM

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Lawana
4 months ago
Investing in common stock? Seems risky for short-term!
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Malinda
4 months ago
Minimizing taxes? Not really the main focus here.
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Lelia
4 months ago
Surprised that people overlook safety!
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Iola
4 months ago
I think maximizing rate of return is more important.
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Alise
5 months ago
Definitely liquidity and safety! That's the priority.
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Julene
5 months ago
Okay, I think I've got this. A company moving to the cloud is trying to shift from capital expenses to operating expenses, so the answer must be D.
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Adelina
5 months ago
Hmm, this seems like a tricky one. I'm not entirely sure what the "compensation philosophy" is referring to. I'll have to think this through carefully and see if I can eliminate any of the options.
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Annett
5 months ago
Wasn't there a practice question that asked about confirming with the lawyer directly? I feel like that could also be a valid part of the audit procedures.
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Glenn
5 months ago
I'm a little confused on how to approach this. I'll need to review my notes on cultural analysis and communication planning to make sure I'm considering all the key factors.
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Jacki
5 months ago
I'm not sure I fully understand the logic here. I better re-read the question a few times to make sure I'm not missing anything.
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