LSU ACCT 2000 EXAM 1 FINAL PAPER 2026
QUESTIONS WITH FULL SOLUTION GRADED
A+
◉ A sole proprietorship has __ owner Answer: 1
◉ A partnership has __________ owners Answer: 2 or more
◉ A corporation has _____ owners due to the issuance of stock
Answer: Many
◉ What are the three advantages of a sole proprietorship? Answer:
1. Simple to establish
2. Control
3. Tax advantages (only have to pay taxes once)
◉ What is a disadvantage of a sole proprietorship? Answer: Personal
liability
ex: someone falls, lawsuit they can take everything even personal
belongings
,◉ What are the three advantages of a partnership? Answer: 1.
Simple to establish
2. Broader skills and resources
3. Tax advantages
◉ What is a disadvantage of a partnership? Answer: Personal
liability
ex: lawsuit; they can take everything from both owners
◉ What are three advantages of a corporation? Answer: 1. Easy to
transfer ownership
2. Easy to raise capital (sell stock)
3. No personal liability (most you can lose is stock investment)
◉ What is a disadvantage of a corporation? Answer: Taxes (paid
twice; once by the company and once when dividends are paid)
Seperate legal entity
◉ Accounting is the information system that _________, __________, and
____________ the economic events of an organization to interested
users. Answer: Identifies, records, and communicates
, ◉ A type of user that uses accounting to plan, organize, or run a
business Answer: Internal user
ex: Managers, supervisors, company officials
◉ A type of user that uses accounting to make decisions on whether
to buy or sell stock or loan a company money Answer: External user
ex: investors (stockholder), creditors, regulators, IRS
◉ effective financial reporting depends on sound Answer: ethical
behavior
◉ An act passed by Congress that deals with ethical behavior of
accounting Answer: Sarbanes-Oxley Act (Sox Act)
◉ What are the three types of business activities? Answer: -
Financing
- Investing
- Operating
◉ Raising money is a type of __________ activity Answer: Financing
QUESTIONS WITH FULL SOLUTION GRADED
A+
◉ A sole proprietorship has __ owner Answer: 1
◉ A partnership has __________ owners Answer: 2 or more
◉ A corporation has _____ owners due to the issuance of stock
Answer: Many
◉ What are the three advantages of a sole proprietorship? Answer:
1. Simple to establish
2. Control
3. Tax advantages (only have to pay taxes once)
◉ What is a disadvantage of a sole proprietorship? Answer: Personal
liability
ex: someone falls, lawsuit they can take everything even personal
belongings
,◉ What are the three advantages of a partnership? Answer: 1.
Simple to establish
2. Broader skills and resources
3. Tax advantages
◉ What is a disadvantage of a partnership? Answer: Personal
liability
ex: lawsuit; they can take everything from both owners
◉ What are three advantages of a corporation? Answer: 1. Easy to
transfer ownership
2. Easy to raise capital (sell stock)
3. No personal liability (most you can lose is stock investment)
◉ What is a disadvantage of a corporation? Answer: Taxes (paid
twice; once by the company and once when dividends are paid)
Seperate legal entity
◉ Accounting is the information system that _________, __________, and
____________ the economic events of an organization to interested
users. Answer: Identifies, records, and communicates
, ◉ A type of user that uses accounting to plan, organize, or run a
business Answer: Internal user
ex: Managers, supervisors, company officials
◉ A type of user that uses accounting to make decisions on whether
to buy or sell stock or loan a company money Answer: External user
ex: investors (stockholder), creditors, regulators, IRS
◉ effective financial reporting depends on sound Answer: ethical
behavior
◉ An act passed by Congress that deals with ethical behavior of
accounting Answer: Sarbanes-Oxley Act (Sox Act)
◉ What are the three types of business activities? Answer: -
Financing
- Investing
- Operating
◉ Raising money is a type of __________ activity Answer: Financing
