Which of the Following Is a Characteristic of a Sole

question 269

Multiple Choice

Which of the following is a characteristic of a sole proprietorship?

• A) It is owned and managed by two or more people.
• B) It is an independent legal entity on its own.
• C) It is owned and managed by one person.
• D) The owner bears no personal responsibility for the debts of the business.

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Definitions:

Activity-Based Costing

A costing method that assigns overhead and indirect costs to specific activities, providing more accurate costing information.

Product B

An arbitrary term that could refer to any second product offered by a company in a given context.

Direct Labor-Hours

The total hours worked by employees directly involved in manufacturing a product, often used as a basis for allocating costs.

Traditional Costing

An accounting method that allocates overhead costs to products based on a predetermined overhead rate and the volume of goods produced.