Which of the Following Points Does the Existence of a Business

question 14

Multiple Choice

Which of the following points does the existence of a business plan demonstrate?

• A) The business process has been carefully planned.
• B) The business will be financially successful.
• C) The business fulfills an important market need.
• D) The business has full-time employees.
• E) The business has a unique idea.

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Definitions:

Consolidated Balance Sheet

A financial statement that combines the assets, liabilities, and equity of a parent company and its subsidiaries into one document.

Deferred Income Taxes

A liability on the balance sheet that results from differences in the timing of recognition of income and expenses for tax and financial reporting purposes.

Straight Line Amortization

A method of allocating the cost of an intangible asset over its useful life in equal annual installments.

Effective Tax Rate

The actual rate at which an individual or a corporation is taxed, calculated by dividing the total tax paid by the taxable income.