You and Two Partners Start a Company

question 42

Multiple Choice

You and two partners start a company.However,your partners play no role in running the company.You devote all our time and talent to run your own business rather than working for someone else.You incur an(a) :

• A)explicit cost.
• B)marginal cost.
• C)sunk cost
• D)opportunity cost.

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Definitions:

Tax Purposes

Refers to any considerations made in financial activities or decision-making to optimize tax liabilities.

Financial Statements

Formal records of the financial activities and condition of a business, entity, or individual.

FIFO

First-In, First-Out, an inventory valuation method where goods first bought are the first ones sold.

Input Cost Changes

Refers to variations in the cost of materials or labor that are used in the production of goods or services.