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NEW QUESTION: 1

A. Option A
B. Option D
C. Option C
D. Option B
E. Option E
Answer: A,B,D

NEW QUESTION: 2
Section A (1 Mark)
Unabsorbed depreciation can be carried forward for ____________.
A. 4 Years
B. Indefinite
C. 8 Years
D. None
Answer: B

NEW QUESTION: 3
In an arrangement between MoeMoney Investment Advisers and one of the firm's clients, the YourMoney mutual fund, part of MoeMoney's compensation is based how the fund performs compared to the S&P 500 Index. If the return on the fund exceeds the return on the index, MoeMoney gets a bonus. The S&P 500 had a return of negative 8% this year, and the fund returned a negative 2%, so MoeMoney invoiced the client for the bonus.
Has MoeMoney violated any securities laws?
A. Yes. Under no circumstances can a bonus be part of an investment adviser's compensation package according to the Uniform Securities Act.
B. No. The fund beat the return on the S&P 500 Index, so MoeMoney is entitled to the bonus, based on its agreement with YourMoney.
C. Yes. It is a violation of the Uniform Securities Act for an investment adviser to earn a bonus if a portfolio it manages loses money.
D. Yes. An investment adviser's compensation cannot be based on the capital appreciation of the portfolio.
Answer: B
Explanation:
Explanation/Reference:
Explanation: No. MoeMoney has not violated any securities laws. Even though the fund's return was negative, it still beat the return on the S&P 500 Index, and MoeMoney is entitled to the bonus. The Uniform Securities Act does not prohibit compensation agreements like this one as long as the client is a sophisticated investor, such as a mutual fund. This would not be permitted if the client were your average individual investor.

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