Henry Is a Carpenter by Trade Who Has His Own

question 51

Multiple Choice

Henry is a carpenter by trade who has his own tools and his own truck.Henry works for a construction company,and after each job,he provides the company with an invoice for the work he has performed.In this case,Henry is

• A)both an agent of the company and an independent contractor.
• B)an employee of the company.
• C)an independent contractor.
• D)an agent of the company.
• E)both an agent and an employee of the company.

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Definitions:

Owners' Equity

The residual interest in the assets of a company after deducting liabilities, representing what the owners own outright.

Investment

The process of distributing funds with the goal of earning revenue or gains.

Acid Test Ratio

A financial metric that measures a company's ability to pay off its short-term liabilities with its quick assets.

Current Liabilities

Short-term financial obligations that are due within a year or within the operating cycle.