The Decision on What Form of Business to Make a Startup

question 89

True/False

The decision on what form of business to make a startup business is important because it will affect the business owner's liability and control of the business.

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Definitions:

Expected Unit Sales

An estimate of the number of units that a company anticipates selling over a specific period.

Markup

An additional cost placed on the buying price of merchandise to offset running costs and achieve profits.

Absorption Costing

An approach to costing that encompasses all costs associated with manufacturing such as direct materials, direct labor, along with variable and fixed overheads, within the per unit cost of products.

Cost-plus Pricing

A pricing strategy where the selling price is determined by adding a specific markup to a product's unit cost.