The Business Is Not Recognized as a Legal Entity Separate

question 38

Multiple Choice

The business is not recognized as a legal entity separate from its owners under which form?

• A) Professional corporation
• B) Limited Liability Company
• C) Partnership
• D) S corporation
• E) Non-profit

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Definitions:

Accounts Receivable

Money owed to a business by its customers from the sale of goods or services on credit.

Credit

A financial arrangement where a borrower receives something of value with the agreement to repay it later, often including interest.

Normal Balance

The side of an account that is usually positive or increased; for assets and expenses, it's the debit side, for liabilities, equity, and revenue, the credit side.

Account

An individual record within a financial system or ledger that tracks the financial transactions of a specific asset, liability, revenue, expense, or equity component.