A proprietorship is an unincorporated business owned by one individual and the owner benefits from the limited liability for business, which limits personal losses to what the proprietor has invested in the company.
Answer the following statement true (T) or false (F)
False
A proprietorship is an unincorporated business owned by one individual. The proprietor has unlimited personal liability for business debts because any debts of the business are considered obligations of the sole owner. See 1-2: Alternative Forms of Business Organization
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To determine whether a bond will sell at a price equal to, greater than, or less than face value, compare the effective interest rate and the market interest rate
Indicate whether the statement is true or false
Under the modified cash basis of accounting, accounts receivable are not entered in the accounting system
Indicate whether the statement is true or false
Firms can elect the fair value option for the following items: (1) bonds held to maturity, (2) available-for-sale securities, and (3) cash flow hedges. Which of the following is/are true?
a. Applying the fair value option to investments in debt securities classified as held to maturity results in accounting for the investments as if they were a trading security, with changes in fair value recognized in income each period. b. Applying the fair value option to available-for-sale securities results in reporting unrealized gains and losses from remeasurement to fair value in net income as fair value changes, instead of initially in other comprehensive income. c. Applying the fair value option to cash flow hedges results in reporting unrealized gains and losses from remeasurement to fair value in net income as fair value changes, instead of initially in other comprehensive income. d. all of the above e. none of the above
Use the information provided in Table 1.2. Based on your productivity calculations, what decision should you make?
A) implement the new process B) stay with the current process C) need more information to make a decision D) Either process is acceptable (since the multi-factor productivities are the same).