1) Which of the following is an advantage of a sole proprietorship?

A) Ease of raising capital

B) Limited liability of owner

C) Unlimited life

D) Ease of formation

2) The Statement of Retained Earnings is used to report:

A) accumulated dividends paid out to shareholders.

B) beginning and ending revenues for the period.

C) accumulated net profits not paid out in dividends.

D) beginning and ending cash balances.

3) Closing entries included debits to revenues for a total of $8,400 credits to expenses for a total of $4,500, and a credit to dividends for $750. The net change in Retained Earnings for the month was:

A) cannot be calculated with the information provided

B) $3,900

C) $3,150

D) $4,650