1. An accounting firm is auditing a company's financial statements. Which of the following is a critical thinking step they must take? A. Accept the company's records at face value. B. Verify the accuracy of the records against external evidence. C. Focus solely on the numerical data. D. Ignore discrepancies that seem minor. Answer: B. Rationale: Critical thinking in accounting involves not taking information at face value and verifying the accuracy of financial records against independent evidence to ensure reliability. 2. When evaluating the logic behind a financial decision, an accountant should: A. Rely on intuition rather than data. B. Consider the potential biases that may affect the decision. C. Disregard the ethical implications. D. Focus on short-term gains over long-term sustainability. Answer: B. Rationale: Accountants must consider potential biases in financial decision-making to ensure that logic and objectivity prevail, especially when ethical implications are involved. 3. In the context of logic and critical thinking, which of the following is true about fallacies? A. They strengthen an argument by providing solid evidence. B. They are errors in reasoning that weaken an argument. C. They are preferred in financial analysis for their persuasive power. D. They are irrelevant in the evaluation of financial statements. Answer: B. Rationale: Fallacies are reasoning errors that can significantly weaken an argument, and recognizing them is crucial in critical thinking and logical analysis. 4. A company is considering investing in new technology to improve efficiency. What critical thinking approach should an accountant take? A. Assume the most expensive option is the best. B. Evaluate the return on investment of each option. C. Choose the option preferred by the majority. D. Avoid new technologies due to the risks involved. Answer: B. Rationale: An accountant should critically evaluate the