A Business Formed by Two or More Individuals Who Each

question 43

Multiple Choice

A business formed by two or more individuals who each have unlimited liability for all of the firm's business debts is called a:

• A) corporation.
• B) sole proprietorship.
• C) general partnership.
• D) limited partnership.
• E) limited liability company.

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Definitions:

Merchandise Inventory

Goods that a retail or wholesale company intends to sell to customers for a profit.

Sales Invoice

A document issued by a seller to a buyer, listing items or services supplied and specifying the amount due for payment.

Purchase Order

A formal document sent from a buyer to a supplier to authorize the purchase of products or services under specified terms and conditions.

Subsidiary Ledger

A detailed ledger that contains the individual accounts needed to support a specific general ledger account.