Which of the following terms best describes the relationship between a corporation and the CPA it hires to audit corporate books? A. Master and servant.
D is corrent. The CPA is not subject to the control of the corporation; thus the CPA is an independent contractor. A is incorrect. A master/servant relationship is a form of a principal agent relationship. The CPA is not subject to the control of the corporation; thus the CPA is an independent contractor. B is incorrect. An employer and principal are essentially the same party; that is not representative of the relationship described here. C is incorrect. An employer/employee relationship is a form of a principal agent relationship. The CPA is not subject to the control of the corporation; thus the CPA is an independent contractor.
