The Entity That Is Under No Legal Requirement to Prepare

question 34

Multiple Choice

The entity that is under no legal requirement to prepare a balance sheet is a:

• A) company.
• B) not-for-profit business.
• C) sole trader.
• D) partnership.

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Definitions:

Present Value

The now value of a future financial amount or series of cash flows, discounted at a particular rate of return.

Future Value

The value of an investment at a future date, considering compound interest or returns over time.

Amortized Loans

Loans that are paid off over time through a series of fixed, regular payments where part of each payment covers the interest expense and the remaining amount reduces the principal balance.

Balloon Payment

A large, one-time payment made at the end of a loan term to pay off the remaining balance, typically used in mortgage or bond agreements.