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AU / Accounting / ACCT 2110 / What are the three main types of business activities?

What are the three main types of business activities?

What are the three main types of business activities?

Description

School: Auburn University
Department: Accounting
Course: Principles of Financial Accounting
Professor: Elizabeth miller
Term: Fall 2015
Tags: Accounting and Principles
Cost: 50
Name: Exam 1 Study Guide
Description: Suggested problems and definitions/examples from chapters 1 and 2.
Uploaded: 01/21/2017
16 Pages 142 Views 3 Unlocks
Reviews


EX 31- 310 39,41, 43, 43-50

Chapter 1

31. Decisions based on accounting information

Match decision with primary decision maker: government (G) investor (I), labor union (U), business manager (M) or a bank (B)

1. Whether or not to lend money to a business. B We also discuss several other topics like Carrying capacity refers to what?

2. Whether or not an individual has paid enough in taxes. G

3. Whether or not to place merchandise on sale to reduce inventory. M We also discuss several other topics like Business to consumer refers to what?

4. Whether or not to invest in a business. I

5. Whether or not to demand additional benefits for employees. U

32. Forms of Business Organizations

Decide which of the three entities (sole proprietorship, partnership, corporation) the following describes then describe the advantages and disadvantages of each type of business entityDon't forget about the age old question of The octopus myth refers to what?

 

1. Owned by one person. Sole proprietorship

2. Can make and sell goods (manufacturing). All Don't forget about the age old question of What is the difference between institutional review board and american psychological association?

3. Owned by more than one person. Partnership and Corporation We also discuss several other topics like Scientific research is based on what?

4. Can sell Goods (merchandising). All If you want to learn more check out What are the significant figures?

5. Can provide and Sell Services. All

6. Legally, a separate entity from the owner(s). Corporation

7. A law firm owned by some of the employees who are each financial obligations of the

entity. Partnership

8. The Coca-Cola Company. Corporation

 

Sole proprietorship:

pros → just you so taxes lower and all decision is yours

cons → completely liable and limited capital

Partnership

pros → individual taxes and access to more capital

cons → shared decisions and still personally liable but for all partners

Corporation

pros → no personal liability huge access to capital and ability to prolong life of a

company

        cons → higher taxes and more complicated to run

33. Business Activities.

Classify each type of activity as operating (O), investing (I), or financing (F)

a. Purchase of equipment                  I

b. Parliament of a dividend                 F

c. Purchase of supplies                 I O

d. Sale of equipment                          I

e. Sale of goods or services                 O

f. borrow money from a bank                 F

g. Contribution of cash by owners         I F 

34. Business Activities 

Classify each type as operating (O), investing (I) , or financing (F)

a. two people contribute cash in exchange for stock F 

b. land and a building to be used as a factory to make appliances were purchased for

cash I

c. machines used to make the appliances were purchased for cash I

d. various matemals weed in appliance production purchased for cash O 

e. three employees paid to operate machinery and make appliances O 

f. Company borrows money from bank F 

g. lean money used to buy advertising I O 

h. appliances were locally sold for cash O

i. second factory built in same location for cash I

j. Company pays a dividend F

35. Accounting Concepts

Concepts and definitions

a. Owner's claim on company resources

b. difference between revenues and expenses

c. increase in asset due to sales

d. economic resources of a company

e. cost of consumed assets due to business operations

f. creditor's claim to company resources

g. distribution of earnings to stockholders

Revenue c

Expense e

Income (loss) b

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