Table of contents

1. Introduction to Accounting1h 21m
2. Transaction Analysis1h 13m
3. Accrual Accounting Concepts2h 38m
4. Merchandising Operations2h 30m
5. Inventory1h 55m
6. Internal Controls and Reporting Cash1h 16m
7. Receivables and Investments3h 8m
8. Long Lived Assets5h 1m
9. Current Liabilities2h 19m
10. Time Value of Money1h 23m
- Time Value of Money Equations
  35m
- Using Time Value of Money Tables
  47m
11. Long Term Liabilities2h 45m
12. Stockholders' Equity2h 15m
13. Statement of Cash Flows2h 24m
14. Financial Statement Analysis5h 25m
15. GAAP vs IFRS56m

1. Introduction to Accounting

Business Organization

Financial Accounting

1. Introduction to Accounting

Business Organization

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Multiple Choice

James owns a sporting goods store by himself and is personally liable for all the store's debts. Which type of business organization does James most likely have?

Limited liability company (LLC)

Corporation

Partnership

Sole proprietorship

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Verified step by step guidance

Step 1: Understand the characteristics of each type of business organization mentioned in the problem. A limited liability company (LLC) provides limited liability protection to its owners, meaning they are not personally liable for the company's debts. A corporation is a separate legal entity that also provides limited liability protection to its shareholders. A partnership involves two or more individuals sharing ownership and liability. A sole proprietorship is owned by one individual who is personally liable for all debts.

Step 2: Analyze the information provided in the problem. James owns the sporting goods store by himself, which means he is the sole owner. Additionally, he is personally liable for all the store's debts, which is a key characteristic of a sole proprietorship.

Step 3: Compare the characteristics of the business organizations to the details provided about James's store. Since James is the sole owner and personally liable for debts, the business organization aligns with the definition of a sole proprietorship.

Step 4: Eliminate the other options. LLC and corporation both provide limited liability protection, which does not match the description of James being personally liable for debts. A partnership requires multiple owners, which is not the case here.

Step 5: Conclude that the correct type of business organization for James's sporting goods store is a sole proprietorship, based on the characteristics and details provided.