When a Person Decides to Go into Business on His

question 59

Multiple Choice

When a person decides to go into business on his or her own and is solely responsible for management and profits,a(n) ________ is formed.

• A)S corporation
• B)sole proprietorship
• C)single-entity partnership
• D)sole entrepreneurship
• E)limited liability company

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Definitions:

Common Stock

Shares representing ownership in a company, providing rights to dividends and a vote in corporate decisions.

Initial Cash Sale

The revenue received from the first sale of goods or services for cash, excluding credit transactions.

Journal Entries

Recorded business transactions in the accounting ledger, detailing the financial effects on the company's accounts.

Stated Value

A value assigned to no-par value stock by the company's board of directors to define a minimum legal capital.