Forms of Business Organization Quiz

Sole Proprietorship is the traditional and popular form of business organization where the owner controls the complete operations of a business and is liable for all financial burdens and debts as long as they are the only owner.

A business organisation is an establishment intended to carry commercial business by producing goods or services and meet the customers’ needs. Most of the organisations have a standard such as social structure, purpose goals, utilisation of resources, rules and regulations, etc.

Partnership is when two or more individuals come together to start a business, each contributing capital, property, employment or experience, and expecting profits or losses from the business share.

<p>The state law regulates the establishment of the business, and IRS law controls the tax incurred for business. The tax a business should pay depends on what form of business it owns.</p> Signup and view all the answers

<p>The most common forms of business organisation are Sole Proprietorship and Partnership.</p> Signup and view all the answers

<p>The main aim of the accounting process is the ascertainment of an organization’s operation’s net results and financial position so that the firm can communicate the same with the interest parties or users of Accounting Information.</p> Signup and view all the answers

<p>The American Institute of Certified Public Accountants(AICPA) defines accounting as an art of recording, classifying, and summarising the transactions and events that are in monetary terms efficiently and effectively and interpreting the results.</p> Signup and view all the answers

<p>The objectives of accounting are: 1. Record: The basic role of accounting is to maintain a systematic, complete, accurate, and permanent record of all business transactions. 2. Planning: Organisations must plan how they intend to allocate their limited resources for competitive needs in the future.</p> Signup and view all the answers

<p>Reliable financial records are systematic, complete, accurate, and permanent, and can be searched and checked at any time.</p> Signup and view all the answers

<p>Budgets allow organisations to plan ahead by anticipating business needs and resources, and they help in allocating limited resources for competitive needs in the future.</p> Signup and view all the answers