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

Which of the following is a characteristic of a sole proprietorship?

It requires at least two owners to operate.

The owner has unlimited liability for business debts.

Ownership is easily transferred through the sale of stock.

The business is taxed as a separate legal entity.

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Verified step by step guidance

Understand the concept of a sole proprietorship: A sole proprietorship is a business owned and operated by one individual. It is the simplest and most common form of business organization.

Review the characteristics of a sole proprietorship: Key features include single ownership, unlimited liability for the owner, and the business income being taxed as part of the owner's personal income rather than as a separate legal entity.

Analyze the options provided in the question: Evaluate each statement to determine whether it aligns with the characteristics of a sole proprietorship.

Option 1: 'It requires at least two owners to operate.' This is incorrect because a sole proprietorship is owned by one individual.

Option 2: 'The owner has unlimited liability for business debts.' This is correct because the owner is personally responsible for all debts and obligations of the business.