Forms of business organization (2 marks)

i.The proprietorship form of business organization

a)is a separate legal entity.

b)enjoys an unlimited life.

c)has unlimited liability.

d)none of the supplied answers.

Answer:c

ii.The corporation form of business organization

a)is a separate legal entity.

b)enjoys an unlimited life.

c)has limited liability.

d)all the supplied answers.

Answer:

iii.The corporation form of business organization

a)is a separate legal entity.

b)is not easily transferrable through the sale of shares.

c)enjoys a limited life.

d)has unlimited liability.

Answer:

iv.The proprietorship form of business organization

a)is not easily transferrable through the sale of shares.

b)enjoys an unlimited life.

c)has limited liability.

d)none of the supplied answers.

Answer:

v.The partnership form of business organization

a)is a separate legal entity.

b)is a common form of organization for service-type businesses.

c)enjoys an unlimited life.

d)has limited liability.

Answer:

Question 2 (5 Marks)

The following are users of financial information. Identify the users as being either external users (E) or Internal users (I).

_____Canada Revenue Agency

_____Labour unions

_____Marketing manager

_____ Auditor

_____ Shareholders

Question 3 (5 Marks)

For the items listed below, fill in the appropriate code letter to indicate whether the item is an Asset (A), Liability (L), or Owner's Equity (OE) item. (3 marks)

______ Inventory

______ Accounts Payable

______ Accourts Receivable

______ Service Revenue

_____ Interest Payable