Multiple Choice
Which of the following types of business organizations may be owned by shareholders or members?
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1. Introduction to Accounting
Business Organization
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Which behavior best describes the primary business activity of operations?
A
Producing and selling goods or services to customers
B
Investing in equipment and property
C
Raising capital by issuing shares of stock
D
Borrowing money from financial institutions
Verified step by step guidance1
Understand the three primary business activities in financial accounting: operations, investing, and financing.
Recognize that operations refer to the core activities of a business, which typically involve producing and selling goods or services to customers.
Differentiate operations from investing activities, which involve acquiring or disposing of long-term assets like equipment and property.
Distinguish operations from financing activities, which include raising capital by issuing shares of stock or borrowing money from financial institutions.
Conclude that the behavior best describing the primary business activity of operations is producing and selling goods or services to customers.
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