The following questions concern possible violations of the rules of conduct discussed in the chapter. Choose the best response

a. In which one of the following situations would a public accountant be in violation of the rules of conduct in determining his or her audit fee?
(1) A fee equal to last year's fee plus 10 percent.
(2) A fee based on the nature of the service rendered and the public accountant's particular expertise instead of the actual time spent on the engagement.
(3) A fee b^sed on whether the public accountant's report orb-th^. client's financial statements results in the approval of a bank loan.
(4) A fee based on the fee charged by the prior auditor.

b. The rules of conduct state that a public accountant shall not disclose any confidential information obtained in the course of a professional engagement except with the con¬ sent of his or her client. In which one of the situations given below would disclosure by a public accountant be in violation of the rules?
(1) Disclosing confidential information in compliance with a subpoena issued by a court.
(2) Disclosing confidential information to another accountant interested in purchasing the public accountant's practice.
(3) Disclosing confidential information in connection with a disciplinary hearing by the public accoun¬ tant's professional conduct committee.
(4) Disclosing confidential information in order to prop¬ erly discharge the public accountant's responsibili¬ ties in accordance with his or her profession's standards.