SURVEY OF ACCOUNTING
COMPREHENSIVE EXAMINATION TEST
VERIFIED QUESTIONS AND ACCURATE
ANSWERS
●● Definition:
Profit
Answer: The difference between the amounts received from the
customers for goods or services and the amounts paid for the inputs used
to provide goods and services.
●● Types of Businesses:
Service Businesses
Answer: Provide services rather than products to customers.
●● Types of Businesses:
Merchandising Businesses
Answer: Sell products they purchase from other businesses to customers.
●● Types of Businesses:
Manufacturing Businesses
Answer: Change basic inputs into products that are sold to customers.
, ●● Forms of Businesses:
Proprietorship
Answer: Owned by one individual, most businesses operate this way.
Advantages: Ease and low cost of organizing, non-taxable entity.
Disadvantages: Financial resources limited to owner's resources. Owner
has unlimited liability for debt.
●● Forms of Businesses:
Partnership
Answer: Owned by 2 or more individuals, 10% of all businesses out
there.
Advantages: Ease and low cost of organizing, non-taxable entity.
Disadvantages: Financial resources limited to owners' resources. Owners
have unlimited liability for debt.
●● Forms of Businesses:
Corporation
Answer: Organized under state or federal statues as a separate legal
entity. Ownership is divided into shares of stock, and stock holders own
the business.
Advantages: Very easy to get financial resources and stockholders are
limited to what they put into the company.
Disadvantages: Complex organization. Taxable entity.
COMPREHENSIVE EXAMINATION TEST
VERIFIED QUESTIONS AND ACCURATE
ANSWERS
●● Definition:
Profit
Answer: The difference between the amounts received from the
customers for goods or services and the amounts paid for the inputs used
to provide goods and services.
●● Types of Businesses:
Service Businesses
Answer: Provide services rather than products to customers.
●● Types of Businesses:
Merchandising Businesses
Answer: Sell products they purchase from other businesses to customers.
●● Types of Businesses:
Manufacturing Businesses
Answer: Change basic inputs into products that are sold to customers.
, ●● Forms of Businesses:
Proprietorship
Answer: Owned by one individual, most businesses operate this way.
Advantages: Ease and low cost of organizing, non-taxable entity.
Disadvantages: Financial resources limited to owner's resources. Owner
has unlimited liability for debt.
●● Forms of Businesses:
Partnership
Answer: Owned by 2 or more individuals, 10% of all businesses out
there.
Advantages: Ease and low cost of organizing, non-taxable entity.
Disadvantages: Financial resources limited to owners' resources. Owners
have unlimited liability for debt.
●● Forms of Businesses:
Corporation
Answer: Organized under state or federal statues as a separate legal
entity. Ownership is divided into shares of stock, and stock holders own
the business.
Advantages: Very easy to get financial resources and stockholders are
limited to what they put into the company.
Disadvantages: Complex organization. Taxable entity.
