Which of the Following Statements Is a Disadvantage of a Sole

question 19

Multiple Choice

Which of the following statements is a disadvantage of a sole proprietorship?

• A)The taxation treatment of partnerships can be a disadvantage.
• B)It is more expensive to establish than a company.
• C)It can be difficult to raise funds for expansion.
• D)There are more regulatory requirements than a company.

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Definitions:

Loss On Redemption

The loss incurred when a debt obligation or security is redeemed before its maturity date at a value less than the original purchase price or par value.

Carrying Amount

The balance of the bonds payable account (face amount of the bonds) less any unamortized discount or plus any unamortized premium.

Unamortized Discount

The portion of a bond's face value that has not yet been expensed as interest over time to reflect the bond being issued below its par value.

Redeemed

The act of paying off or buying back something, such as repaying a bond or exchanging a coupon for goods.