Is the following action or situation a violation of the AICPA Code of Professional Conduct? Lavery (not a CPA) owns 90% of a real estate partnership and is the managing partner; CPA Poirot owns 10% of the real estate partnership. Poirot is the audit manager for the bank where Lavery recently obtained a loan.

A. Yes. B. No, because the CPA owns less than 25% of the real estate partnership. C. No, because the CPA owns less than 50% of the real estate partnership.

2. Is the following action or situation a violation of the AICPA Code of Professional Conduct? CPA Schultz purchased a variable annuity insurance contract that offered the option to choose the companies in which the contract will invest. As directed by Schultz, the insurance company purchased common stock in one of Schultz's audit clients.

A. Yes. B. No, but it would have been acceptable to purchase preferred stock. C. No, never.