What form of organization will enable one to limit risk of loss to the amount she has invested in the business?
Corporation
Because if the
... [Show More] corporation fails and cannot pay itsliabilities, creditors cannot force shareholders to pay the business's debts from their personal assets.
Therefore, the most an investor can expect to lose on an investment in this type of corporation is the amount invested.
What form of business organization will give the most freedom to manage the business as she wishes?
A proprietorship will give Mary the most freedom to manage the business as she wishes.
Under this form, there is a single owner of the business, so the owner has absolute control over the business.
What form of organization will give creditors the maximum protection in the event that Quality Environmental fails and cannot pay its liabilities?
Partnership
If a partnership fails and cannot pay its liabilities, creditors can force the partners to pay the business's debts from their personal assets.
This affords more protection to creditors because there are two or more owners to share this personal liability for the business's debts.
The primary objective of financial reporting is to provide information:
A. about the profitability of the enterprise.
B. on the cash flows of the company.
C. useful for making investment and credit decisions.
Your answer is correct.
D. to the federal government.
C. useful for making investment and credit decisions.
Your answer is correct.
For a business of a certain size, which type of business organization provides the least amount of protection for bankers and other creditors of the company?
Proprietorship
Another name for the balance sheet is the
A.
statement of earnings.
B.
statement of operations.
C.
statement of financial position.
Your answer is correct.
D.
statement of profit and loss.
C. statement of financial position.
Expenses are increased in retained earnings that result from operations.
a) True
b) False
False [Show Less]