E3.17 A business organised as a separate legal entity that is owned by shareholders is a:

a. partnership.

b. company.

c. sole trader.

d. legal partnership.

Answer:

E3.20 Equity finance for a sole trader comes from:

a. the issue of shares to the public.

b. borrowings from financial institutions.

c. the owner and profit retained in the business.

d. government loans.

Answer:

E3.21 Partnerships are most common among:

a. doctors.

b. accountants.

c. lawyers.

d. all of the above.

Answer:

E3.22 For a partnership to be legal, the agreement should:

a. be in writing.

b. indicate a sharing of a bank account.

c. indicate how profits and losses are to be shared.

d. have any one or more of the above characteristics.

Answer:

E3.26 A sole trader in Australia is taxed at:

1. the company tax rate of 30 per cent
2. the same as the rate of capital gains tax for the owner.
3. the owners marginal tax rate.
4. both the rates in (b) and (c) above.

Answer: