A Corporation Is Responsible for Its Actions and Any Debts

question 173

True/False

A corporation is responsible for its actions and any debts incurred. It can enter into its own contracts, and it can buy, own, and sell property.

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Definitions:

Capital Assets

Long-term assets that a business uses in its operations and that are not intended for resale, such as property, plant, and equipment.

Deferral Method

An accounting practice that involves postponing the recognition of revenue or expenses until a future date.

Restricted Fund Method

An accounting practice for nonprofit organizations, segregating funds according to restrictions imposed by donors.

Deferral Method

A method of accounting that allows for income or expenses to be recognized at a later date rather than when they are initially incurred.