An Important Fact to Consider When Determining How to Organize

question 103

Multiple Choice

An important fact to consider when determining how to organize a business is that:

• A)members of an LLC have unlimited liability and are taxed like members of a partnership.
• B)for accounting purposes,a proprietorship is a distinct entity from the proprietor.
• C)the records of a partnership can include each partner's personal assets and debts.
• D)the proprietor and the proprietorship are separate legal entities.

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Definitions:

Hedging

Reducing a firm’s exposure to price or rate fluctuations. Also immunization.

Economic Exposure

The risk that a company's cash flow, earnings, or future value will be affected by changes in exchange rates.

May Coffee Futures

Agreements that bind the purchaser to buy, and the seller to sell coffee, at an agreed price and date in the future.

Lifetime High

The highest price level reached by a stock, bond, or other security during its entire trading history.