Question: According to Exhibit 4-8, which is

> 1. Two cars, driven by Fred and Barney, collide. At trial, the jury determines that the accident was 90% Fred's fault and 10% Barney's fault. Barney's losses total $100,000. If he lives in a state that uses contributory negligence, Barney will recover __

> 1. While in college, David invented a new and useful machine to make macaroni and cheese (he called it the “Mac ‘n’ Cheeser”). It was like nothing on the market, but David did not apply for a patent. At that time, he offered to sell his invention to seve

> 1. Tariq Ahmad decided to dispose of some of his laboratory’s hazardous chemicals by shipping them to his home in Pakistan. He sent the chemicals to Castelazo (a company in the United States) to prepare the materials for shipment. Ahmad did not tell the

> A disc jockey named Z-Trip made a remix of a Beastie Boys song with the hip-hop group’s permission. Monster Energy (ME), an energy drink company, wanted to use the remix as part of a video promotion. Monster Energy sent an email asking Z-Trip to approve

> Mast Industries and Bazak International were two textile firms. Mast orally offered to sell certain textiles to Bazak for $103,000. Mast promised to send documents confirming the agreement, but never did. Finally, Bazak sent a memorandum to Mast confirmi

> ETHICS Jacob Deutsch owned commercial property. He orally agreed to rent it for six years to Budget Rent-A-Car. Budget took possession, began paying monthly rent, and over a period of several months expended about $6,000 in upgrading the property. Deutsc

> When Steven Simkin and Laura Blank divorced in 2006, they agreed to split their $13.5 million fortune evenly. Two years later, it became evident that Simkin had a problem: his half was invested in Bernard Madoff’s giant Ponzi scheme and he lost millions.

> 1. Pfizer Inc. paid $2.3 billion to settle civil and criminal charges alleging that it had illegally marketed 13 of its most important drugs. This settlement made history, but not in a good way. It was both the largest criminal fine and the largest settl

> Paula was alone, pregnant, and confused. She needed help and support, which she found at Methodist Mission Home of Texas. In the days following her child’s birth, representatives of Methodist Mission forcefully told her that she had no moral or legal rig

> Ball-Mart, a baseball card store, had a 1968 Nolan Ryan rookie card in almost perfect condition for sale. Any baseball collector would have known that the card was worth at least $1,000; the published monthly price guide listed its market value at $1,200

> 1. Arthur, John, and George formed a partnership to drill and maintain cesspools for two years. After less than two months, John and George sent a letter to Arthur informing him that they were dissolving the partnership. Arthur sued the two other men, as

> 1. Jane writes an article for a newspaper reporting that Ann was arrested for stealing a car. The story is entirely false. Ann is not a public figure. Which of the following torts has Jane committed? A. Ordinary slander B. Slander per se C. Libel D. None

> 1. Alan Dershowitz, a law professor famous for his prominent clients, joined with other lawyers to open a kosher delicatessen, Maven’s Court. Dershowitz met with greater success at the bar than in the kitchen—the deli failed after barely a year in busine

> 1. An employer placed a job advertisement for security guards, specifying that applicants had to be United States citizens. It also required applicants to present a social security card. Was this ad legal? 2. In the 2008 recession, Roger lost his job as

> 1. A Saudi Arabian government-run hospital hired American Scott Nelson to be an engineer. The parties signed the employment agreement in the United States. On the job, Nelson reported that the hospital had significant safety defects. For this, he was arr

> 1. Apex gave Marcie an unemployment handbook stating that (1) she was an at-will employee, (2) the handbook did not create any contractual rights, and (3) employees who were fired had the right to a termination hearing. The company fired Marcie, claim

> 1. An elementary school custodian hit a child who wrote graffiti on the wall. Is the school district liable for this intentional tort by its employee? 2. What if the custodian hit one of the schoolchildren for calling him a name? Is the school district l

> Richard and Michelle Kommit traveled to New Jersey to have fun in the casinos. While in Atlantic City, they used their MasterCard to withdraw cash from an ATM conveniently located in the “pit” - the gambling area of a casino. They ran up debts of $5,500

> 1. One of Doris’s job responsibilities at Winkie, Inc. was preparing company checks for the president, Willie, to sign. Using Winkie’s check-signing machine, Doris forged $150,000 of checks on her employer’s account. Willie did not (1) look at the sequen

> 1. Kay signed a promissory note for $220,000 that was payable to Investments, Inc. The company then indorsed the note over to its lawyers to pay past and future legal fees. Were the lawyers holders in due course? 2. Shelby wrote the following check to Da

> 1. Eugene Ables ran an excavation company. He borrowed $500,000 from the Highland Park State Bank. Ables signed a note promising to repay the money and an agreement giving Highland a security interest in all of his equipment, including after-acquired equ

> 1. Mastercraft Boat manufactured boats and often used instrument panels and electrical systems assembled and/or manufactured by Ace Industries. Typically, Ace would order electrical instruments and other parts and assemble them to specifications that Mas

> 1. In a criminal case, which statement is true? A. The prosecution must prove the government’s case by a preponderance of the evidence. B. The criminal defendant is entitled to a lawyer even if she cannot afford to pay for it herself. C. The police are

> 1. Franklin Miller operated Miller Seed Co. in Pea Ridge, Arkansas. He bought, processed, and sold fescue seed, which is used for growing pasture and fodder grass. Farmers brought seed to Miller who would normally clean, bag, and store it. In some cases,

> Each time employees at BizCorp enter their work computers, the following alert appears: “You are attempting to access the BizCorp network. By logging in, you agree to BizCorp’s Computer Usage Policy and certify that your use of this computer is strictly

> Ryan Leslie, a rapper, was distraught when someone stole his computer and external hard drive because they contained some music he was writing. In an effort to retrieve his items, he created a series of YouTube videos, news articles, and social media pos

> 1. Lewis signed a contract for the rights to all timber located on Nine Mile Mine. He agreed to pay $70 per thousand board feet ($70/mbf). As he began work, Nine Mile became convinced that Lewis lacked sufficient equipment to do the job well and forbade

> 1. Commercial Union Insurance Co. (CU) insured Redux, Ltd. The contract made CU liable for fire damage, but stated that the insurer would not pay for harm caused by criminal acts of any Redux employees. Fire destroyed Redux’s property. CU claimed that th

> The day after Thanksgiving, known as Black Friday, is the biggest shopping day of the year. One major retailer advertised a “Black Friday only” laptop for $150. On Thanksgiving night, hundreds of people waited for the store to open to take advantage of t

> Case law tells us that a course syllabus is not a binding contract—but how about your school’s honor code? Under what conditions could an honor code be a contract?

> Some laws give consumers the right to cancel certain contracts for any reason within a short period of time after entering into them. For example, consumers in the European Union can return anything purchased online for any reason or no reason at all. Co

> 1. Guyan Machinery, a West Virginia manufacturing corporation, hired Albert Voorhees as a salesman and required him to sign a contract stating that if he left Guyan he would not work for a competing corporation anywhere within 250 miles of West Virginia

> 1. American Bakeries had a fleet of over 3,000 delivery trucks. Because of the increasing cost of gasoline, the company was interested in converting the trucks to propane fuel. It signed a requirements contract with Empire Gas, in which Empire would conv

> When Steven was killed in an automobile accident, he left his wife, Debra a life insurance policy for $60,000. She decided to move from Bunkie to Sulphur, Louisiana. Debra executed a document authorizing her mother-in-law, Helen, to sign checks on Debra’

> 1. A bill is vetoed by ___. A. the Speaker of the House B .a majority of the voting members of the Senate C. the President D. the Supreme Court 2. If a bill is vetoed, it may still become law if it is approved by ___. A. Two-thirds of the Supreme Court B

> What are some patterns that could be found using diagnostic analysis? Between which types of variables?

> What does a Z-score greater than three (or minus three) suggest? How is that useful in finding extreme values? What type of analysis should we do when we find extreme or outlier values?

> One of the benefits of Data Analytics is the ability to see and test the full population. In that case, why is sampling (even monetary sampling) still used, and how is it useful?

> One type of descriptive analytics is age analysis. Why are auditors particularly interested in the aging of accounts receivable and accounts payable? How does this analysis help evaluate management judgment on collectability of receivables and potential

> Implementing continuous auditing procedures is similar to automating an audit plan with the additional step of scheduling the automated procedures to match the timing and frequency of the data being evaluated and the notification to the auditor when exce

> What approach should a company make if its continuous audit system has too many alarms that are false positives? How would that approach change if there are too many missed abnormal events (such as false negatives)?

> Simple to complex Data Analytics can be applied to a client’s data during the planning stage of the audit to identify which areas the auditor should focus on. Which types of techniques or tests might be used in this stage?

> Who developed the audit data standards? In your opinion, why is it the right group to develop and maintain them rather than, say, the Big 4 firms or a small practitioner?

> Consider Exhibit 5-3. Looking at the audit data standards order-to-cash process, what function is there for the AR Adjustments transaction table—that is, adjustments to the Accounts Receivable? Why is this an audit data standard, and why is it important

> What are the advantages of the use of homogeneous systems? Would a merger target be more attractive if it used a similar financial reporting system as the potential parent company?

> Regarding the data request form, why do you think it is important to the database administrator to know the purpose of the request? What would be the importance of the “To be used in” and “intended audience” fields?

> In your opinion, is the primary reason that analysts use inappropriate scales for their charts primarily due to an error related to naiveté (or ineffective training), or are the inappropriate scales used so the analyst can sway the audience one way or th

> Datavizcatalogue.com lists seven types of maps in its listing of charts. Which one would you use to assess geographic customer concentration by number? How could you show if some customers buy more than other customers on such a map? Would you use the sa

> The Big 4 accounting firms (Deloitte, EY, KPMG, and PwC) dominate the audit and tax market in the United States. What chart would you use to show which accounting firm dominates in each state in terms of audit revenues? Any there other interesting ways y

> According to Exhibit 4-8, which is the best chart for comparisons of earnings per share over many periods? How about for only a few periods?

> Evaluate the use of multiple colors in the graphic associated with the opening vignette regarding the 2016 presidential election. Would you consider its use effective or ineffective? Why? Can you think of a better way to communicate the extent to which p

> Why was the graphic associated with the opening vignette regarding the 2016 presidential election an effective way to communicate the voter outcome for 50 states? What else could have been used to communicate this, and would it have been more or less eff

> Name three accounts that it would be appropriate and interesting to apply Benford’s Law in auditing those accounts? Why would an auditor choose those three accounts? When would a departure from Benford’s Law encourage the auditor to investigate further

> How could XBRL be used by an investor to do an analysis of the industry’s inventory turnover?

> Why would the use of data reduction be useful to highlight related party transactions (e.g., CEO has her own separate company that the main company does business with)?

> In the ETL process, when an analyst is completing the data request form, there are a number of fields that the analyst is required to complete. Why do you think it is important for the analyst to indicate the frequency of the report? How do you think tha

> How might clustering be used to explain customers that owe us money (accounts receivable)?

> An auditor is trying to figure out if the goodwill its client recognized when it purchased a factory has become impaired. What characteristics might be used to help establish a model predicting goodwill impairment?

> An auditor is trying to figure out if the inventory at an electronics store chain is obsolete. What characteristics might be used to help establish a model predicting inventory obsolescence?

> Related party transactions involve people who have close ties to an organization, such as board members. Assume an accounting manager decides that fuzzy matching would be a useful technique to find undisclosed related party transactions. What data would

> Use the College Scorecard data to determine if different regions of the country have significantly different costs of attendance (same as Problem 6 above) and fill out a data request form in order to extract the appropriate data. Use the template from th

> Which attributes from the College Scorecard data would you need to determine if different regions of the country have significantly different costs of attendance?

> Which attributes from the College Scorecard data would you need to compare the percentage of students who receive federal loans at universities above and below the median cost of attendance across all institutions (public, private non-profit, or private

> Which attributes from the College Scorecard data would you need to compare completion rate across types of institutions (public, private non-profit, or private for-profit)?

> Which attributes from the College Scorecard data would you need to compare levels of diversity across types of institutions (public, private non-profit, or private for-profit)?

> Which attributes from the College Scorecard data would you need to compare SAT scores across types of institutions (public, private non-profit, or private for-profit)?

> What is included in mastering the data as part of the IMPACT cycle described in the chapter?

> If you were conducting a data analysis in order to compare the percentage of students who receive federal loans at universities above and below the median cost of attendance across all institutions, you would be conducting several steps in your analysis.

> If you were analyzing the levels of diversity across public and private institutions using the College Scorecard data, how would you define diversity in terms of the data provided? Would it be beneficial to combine fields?

> Consider the 2013 declined loan data from Lending Club titled “RejectStatsB2013.” Similar to the analysis done in the chapter, let’s scrub the employment length. Because our analysis requires risk scores, debt-to-income data, and employment length, we ne

> Consider the 2013 declined loan data from LendingClub titled “RejectStatsB2013.” Similar to the analysis done in the chapter, let’s scrub the debt-to-income data. Because our analysis requires risk scores, debt-to-income data, and employment length, we n

> Consider the 2013 declined loan data from LendingClub titled “RejectStatsB2013” from the Connect website. Similar to the analysis done in the chapter, let’s scrub the risk score data. First, because our analysis requires risk scores, debt-to-income data,

> Download the rejected loans dataset of LendingClub data titled “Reject Stats A Ready” from the Connect website and do an Excel PivotTable by state; then figure out the number of rejected applications for each state. Reorder these and make a graph orderin

> 1. Mastering the data can also be described via the ETL process. The ETL process stands for: a. Extract, total, and load data. b. Enter, transform, and load data. c. Extract, transform, and load data. d. Enter, total, and load data. 2. The goal of the ET

> 1. Big Data is often described by the three Vs, or a. Volume, velocity, and variability. b. Volume, velocity, and variety. c. Volume, volatility, and variability. d. Variability, velocity, and variety. 2. Which approach to Data Analytics attempts to assi

> 1. The DuPont analysis of return on equity (ROE) includes all of the following component ratios except: a. Asset turnover. b. Inventory turnover. c. Financial leverage. d. Profit margin. 2. XBRL stands for: a. Extensible Business Reporting Language. b. E

> 1. What would you consider to be Financial Performance KPIs? a. Total Shareholder Return b. Customer Profitability Score c. Market Growth Rate d. Klout Score 2. What would you consider to be an Operational KPI? a. Inventory Shrinkage Rate b. Brand Equity

> In the ETL process, the first step is extracting the data. When you are obtaining the data yourself, what are the steps to identifying the data that you need to extract?

> 1. Which items would be currently out of scope for Data Analytics? a. Direct observation of processes b. Evaluation of time stamps to evaluate workflow c. Evaluation of phantom vendors d. Duplicate payment of invoices 2. What would be the sampling interv

> 1. Under the guidance of the chief audit executive (CAE) or another manager, these individuals build teams to develop and implement analytical techniques to aid all of the following audits except: a. Process efficiency and effectiveness. b. Governance, r

> 1. Gold, silver, and bronze medals would be examples of: a. Nominal data. b. Ordinal data. c. Structured data. d. Test data. 2. In the late 1960s, Ed Altman developed a model to predict if a company was at severe risk of going bankrupt. He called his sta

> 1. Is a set of data used to assess the degree and strength of a predicted relationship. a. Training data b. Unstructured data c. Structured data d. Test data 2. Data that are organized and reside in a fixed field with a record or a file. Such data are

> Can you think of any other settings, besides financial reports, where tagged data might be useful for fast, accurate analysis generally completed by computers? How could it be used in a hospital setting? Or at your university?

> Go to finance.yahoo.com and type in the ticker symbol for Apple (AAPL) and click on the statistics tab. Which of those variables would be useful in assessing profitability?

> Go to https://xbrl.us/data-rule/dqc_0015-lepr/ and find the XBRL element name for Other NonOperating Income and indicate whether XBRL says that should normally be a debit or credit entry.

> Go to https://xbrl.us/data-rule/dqc_0015-lepr/ and find the XBRL element name for Interest Expense and Sales, General, and Administrative expense.

> Why do audit firms perform analytical procedures to identify risk? Which type of ratios (liquidity, solvency, activity, and profitability ratios) would you use to evaluate the company’s ability to continue as a going concern?

> Would you recommend the Securities and Exchange Commission require the use of sparklines on the face of the financial statements? Why or why not?

> Describe the IMPACT cycle. Why does its order of the processes and its recursive nature make sense?

> Which would you predict would have more positive sentiment in a 10-K, the financial statements or the MD&A (management discussion and analysis) of the financial statements? More positive sentiment in the footnotes or MD&A? Why?

> In which of the four components of a Balanced Scorecard would you put the Walton College’s diversity initiative? Why do you think this is important for a public institution of higher learning?

> If the data underlying your digital dashboard are updated in real time, why would you want to update your digital dashboard in real time? Are there situations when you would not want to update your digital dashboard in real time? Why or why not?

> Why is Customer Retention Rate a great KPI for understanding your Tesla customers?

> For a company like Walmart, how would the Balanced Scorecard help balance the desire to be profitable for its shareholders with continuing to develop organizational capacity to compete with Amazon (and other online retailers)?

> For an accounting firm like PwC, how would the Balanced Scorecard help balance the desire to be profitable for its partners with keeping the focus on its customers?

> Amazon, in the author’s opinion, has cared less about profitability in the short run but has cared about gaining market share. Arguably Amazon gains market share by taking care of the customer. Given the “Suggested 75 KPIs That Every Manager Needs to Kno

> We know that a Balanced Scorecard is comprised of four components: financial (or stewardship), customer (or stakeholder), internal process, and organizational capacity (or learning and growth). What would you include in a dashboard for the internal proce

> We know that a Balanced Scorecard is comprised of four components: financial (or stewardship), customer (or stakeholder), internal process, and organizational capacity (or learning and growth). What would you include in a dashboard for the financial and

> One type of descriptive analytics is simply sorting data. Why is seeing extreme values helpful (minimums, maximums, counts, etc.) in evaluating accuracy and completeness and in potentially finding errors and fraud and the like?

> How might Data Analytics be used in financial reporting? And how might it be used in doing tax planning?