Which of the Following Statements About the Operation of a Corporation

question 208

Multiple Choice

Which of the following statements about the operation of a corporation is correct?

• A) A corporation receives its charter from a state government.
• B) A corporate charter automatically expires in 99 years and must be renewed if the corporation wants to remain in business.
• C) Owners of a corporation have unlimited liability for any claims against their company.
• D) A corporation tends to be much easier to set up than a sole proprietorship or partnership.

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Definitions:

Total Manufacturing Costs

The aggregate amount of costs incurred in the process of producing goods, including direct materials, direct labor, and manufacturing overhead.

Work in Process Inventory

Items undergoing production that are not fully complete but are part way through the manufacturing process.

Overhead Applied

The allocation of overhead costs to specific products or production jobs based on a predetermined overhead rate.

T-account

A simplified accounting tool that represents the two sides of every financial transaction as debits and credits.