Which of the Following Is True of a Sole Proprietorship

question 99

Multiple Choice

Which of the following is true of a sole proprietorship in the United States?

• A) It is the most expensive way to create a business organization.
• B) The daily management is controlled by the owner.
• C) The transfer of ownership is a complex process.
• D) The debt of the business is shared by all stakeholders.

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Definitions:

LIFO Inventory Method

An inventory costing method that assumes the last items put into inventory are the first ones taken out, used in calculating cost of goods sold.

Gross Profit

The difference between total sales revenue and the cost of goods sold, before deducting overheads, salaries, and other expenses.

Raw Materials Inventories

Represents the stock of basic inputs that have not yet been used in the manufacturing process.

Manufacturer

A business or company engaged in the production of goods for sale, using labor, machines, tools, and chemical or biological processing or formulation.