Lisa Larue operated a beauty parlour under the name You Look Marvelous. Initially it was a sole proprietorship, but after being in business for a year, Lisa decided to incorporate as YLM Ltd
The bank with which she had been dealing for the past year demanded that she now sign a demand promissory note, which she did, as "Lisa Larue". When the note was not paid by YLM, the bank sued Lisa personally. Which of the following is TRUE?
A) Lisa is not liable. The whole point of incorporating was to obtain limited liability.
B) Lisa is liable because she did not make clear in the note that she was signing on behalf of YLM Ltd.
C) Lisa is not liable because the bank knew that Lisa had incorporated and therefore intended not to assume personal liability for the business's debts.
D) Lisa is liable because she is the sole shareholder
E) Lisa is not liable as the promissory note is void due to mistake
B
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The financial statement that primarily reflects events related to the operating activities of a business, or the selling of products or providing services is the_____________
Fill in the blank(s) with correct word
Which of the following is not expressed in terms of a percentage?
a. Return on equity b. Debt to equity ratio c. Current ratio d. Profit margin
Answer the following statements true (T) or false (F)
1) When a manufacturing company uses a standard cost system, Work-in-Process Inventory is debited at standard input quantities and standard costs. 2. When a manufacturing company uses a standard cost system, an unfavorable variance is a contra expense 3. The standard cost income statement doesn't alter the actual operating income—it simply emphasizes the variances from standard. 4. On a standard cost income statement, the variances with debit balances are shown in parentheses because they are contra expenses and therefore decrease the expense Cost of Goods Sold. n a Standard Cost System? (H1)
Which of the following will not result in dissolution of a partnership?
A) Withdrawal of a partner. B) Negative capital balance of a partner. C) Death of a partner. D) Admission of a new partner.