All of the Following Are Advantages for Choosing a Proprietorship

question 85

Multiple Choice

All of the following are advantages for choosing a proprietorship for a business except

• A)a proprietorship is a simple form of business to set up.
• B)a proprietorship gives the owner control of the business.
• C)proprietorship receive more favorable tax treatment.
• D)transfer of ownership is easily achieved through stock sales.

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Definitions:

Drawing Account

An account used to track withdrawals made by the owner of a sole proprietorship from the business for personal use.

Temporary Account

An account in financial accounting that is used to collect revenues, expenses, and withdrawal information which is transferred to permanent accounts at the end of an accounting period.

Accumulated Depreciation

The total amount of a company's assets' depreciation since the assets were acquired, reflecting how much of the assets' value has been used up over time.

Drawing Account

An account used to record withdrawals of cash or other assets from a business by the owner for personal use.