Question 1

A business which is a separate legal entity can be a:

Accepted Answer

A) sole trader. 
B) partnership. 
C) company. 
D) all options are businesses which are separate legal entities 
A) sole trader. 
B) partnership. 
C) company. 
D) all options are businesses which are separate legal entities C

Question 2

Which of these entities is not required,under the Corporations Act,to prepare a full set of financial statements in accordance with the accounting standards?

Accepted Answer

A) A large proprietary company 
B) A public company 
C) A disclosing entity 
D) A partnership 
A) A large proprietary company 
B) A public company 
C) A disclosing entity 
D) A partnership D

Question 3

Which of the following is not an advantage of the company form of business?

Accepted Answer

A) It has a unlimited life. 
B) It has limited liability. 
C) It has the ability to raise large amounts of capital. 
D) It must comply with the Corporations Act 2001 and other legislation. 
A) It has a unlimited life. 
B) It has limited liability. 
C) It has the ability to raise large amounts of capital. 
D) It must comply with the Corporations Act 2001 and other legislation. D

Question 4

A company has which of these sets of characteristics?

Accepted Answer

A) Harder to raise funds and gives the owner full control 
B) Shared control,tax advantages for family members,limited life 
C) Simple to set up and control will always remain with the founder 
D) Easier to transfer ownership and raise funds,and limited liability 
A) Harder to raise funds and gives the owner full control 
B) Shared control,tax advantages for family members,limited life 
C) Simple to set up and control will always remain with the founder 
D) Easier to transfer ownership and raise funds,and limited liability

Question 5

The sole trader form of business organisation:

Accepted Answer

A) is classified as a separate legal entity. 
B) combines the records of the business with the personal records of the owner. 
C) must apply for an Australian Business Number. 
D) must have at least two owners. 
A) is classified as a separate legal entity. 
B) combines the records of the business with the personal records of the owner. 
C) must apply for an Australian Business Number. 
D) must have at least two owners.

Question 6

Which of the following would be a disadvantage of a private company going public?

Accepted Answer

A) increased disclosure requirements 
B) costs associated with running IPOs 
C) potential loss of control 
D) all options are disadvantages 
A) increased disclosure requirements 
B) costs associated with running IPOs 
C) potential loss of control 
D) all options are disadvantages

Question 7

The appropriate business structure that is popular among sporting clubs and not-for profit organisations such as charities and social groups is:

Accepted Answer

A) a public company whose capital is limited by shares 
B) a public company whose share capital is limited by guarantee 
C) a public company which are no-liability companies 
D) a public company whose share capital is unlimited. 
A) a public company whose capital is limited by shares 
B) a public company whose share capital is limited by guarantee 
C) a public company which are no-liability companies 
D) a public company whose share capital is unlimited.

Question 8

It is true that a partnership:

Accepted Answer

A) has limited liability. 
B) has an unlimited life. 
C) is a common structure for service type businesses. 
D) must have a formal written partnership agreement 
A) has limited liability. 
B) has an unlimited life. 
C) is a common structure for service type businesses. 
D) must have a formal written partnership agreement

Question 9

Which of these is not true for a public company?

Accepted Answer

A) It must be listed on the stock exchange 
B) It can issue shares to the public at large 
C) It must prepare financial statements in accordance with the accounting standards 
D) It must have an Australian Company Number 
A) It must be listed on the stock exchange 
B) It can issue shares to the public at large 
C) It must prepare financial statements in accordance with the accounting standards 
D) It must have an Australian Company Number

Question 10

A company is a legal entity.Which of these is a feature of a legal entity?

Accepted Answer

A) Has shareholders 
B) Must pay dividends 
C) Can own assets 
D) Must prepare reports 
A) Has shareholders 
B) Must pay dividends 
C) Can own assets 
D) Must prepare reports

Question 11

A major (advantage/disadvantage)____________________ of a partnership is mutual agency.

Accepted Answer

The answer of A major (advantage/disadvantage)____________________ of a partnership is...

Question 12

Private companies in Australia must have

Accepted Answer

A) at least one shareholder 
B) at least two shareholders 
C) at least three shareholders 
D) more than fifty shareholders 
A) at least one shareholder 
B) at least two shareholders 
C) at least three shareholders 
D) more than fifty shareholders

Question 13

Which financial statement is concerned with the enterprise at a point in time?

Accepted Answer

A) Statement of cash flows 
B) Income statement 
C) Retained earnings statement 
D) Balance sheet 
A) Statement of cash flows 
B) Income statement 
C) Retained earnings statement 
D) Balance sheet

Question 14

A business that is not a legal entity,where there is one owner who is fully liable for all of its debts,is:

Accepted Answer

A) a trust. 
B) a proprietary company. 
C) a sole trader. 
D) a public company. 
A) a trust. 
B) a proprietary company. 
C) a sole trader. 
D) a public company.

Question 15

An advantage of a private company becoming a public company is:

Accepted Answer

A) Separation of ownership and control 
B) Increased disclosure 
C) The opportunity costs of underpricing a share offer 
D) The potential to reduce the cost of equity 
A) Separation of ownership and control 
B) Increased disclosure 
C) The opportunity costs of underpricing a share offer 
D) The potential to reduce the cost of equity

Question 16

A major (advantage/disadvantage)____________________ of a sole trader is unlimited liability.

Accepted Answer

The answer of A major (advantage/disadvantage)____________________ of a sole trader...

Question 17

A disadvantage of operating as a sole trader is:

Accepted Answer

A) being unincorporated 
B) having a business that is inexpensive to start up and wind down 
C) having very little government regulation 
D) having total control of business decisions 
A) being unincorporated 
B) having a business that is inexpensive to start up and wind down 
C) having very little government regulation 
D) having total control of business decisions

Question 18

Bill owns a proprietary company called Bill's Bakehouse Pty Ltd that runs a busy pie shop.At the end of the 2013 financial year,Bill asked his son,Ben,who is a first year accounting student to help him prepare the balance sheet and income statement for Bill's Bakehouse Pty Ltd.Due to lack of knowledge and experience,Ben has incorrectly prepared the balance sheet and income statement as follows:
   
Required
Help Ben to prepare the correct balance sheet and income statement for Bill's Bakehouse Pty Ltd for the year ended 30th June 2013.

Accepted Answer

Question 19

A discretionary trust is

Accepted Answer

A) a trust which holds a collection of assets on behalf of various parties rather than family members. 
B) a trust from which income is distributed to the parties according to their respective unit holdings in the trust. 
C) a trust that usually concentrates on a particular investment such as equity,property or cash management. 
D) a trust which provides the trustee with discretion,according to the trust deed,over who receives distributions from the trust. 
A) a trust which holds a collection of assets on behalf of various parties rather than family members. 
B) a trust from which income is distributed to the parties according to their respective unit holdings in the trust. 
C) a trust that usually concentrates on a particular investment such as equity,property or cash management. 
D) a trust which provides the trustee with discretion,according to the trust deed,over who receives distributions from the trust.

Question 20

Which of the following is an advantage of being a sole trader?

Accepted Answer

A) the owner has total autonomy over business decisions 
B) the owner has unlimited liability 
C) the business has limited life 
D) the business is not a separate legal entity 
A) the owner has total autonomy over business decisions 
B) the owner has unlimited liability 
C) the business has limited life 
D) the business is not a separate legal entity

A business which is a separate legal entity can be a:

Which of these entities is not required,under the Corporations Act,to prepare a full set of financial statements in accordance with the accounting standards?

Which of the following is not an advantage of the company form of business?

A company has which of these sets of characteristics?

The sole trader form of business organisation:

Which of the following would be a disadvantage of a private company going public?

The appropriate business structure that is popular among sporting clubs and not-for profit organisations such as charities and social groups is:

It is true that a partnership:

Which of these is not true for a public company?

A company is a legal entity.Which of these is a feature of a legal entity?

A major (advantage/disadvantage)____________________ of a partnership is mutual agency.

Private companies in Australia must have

Which financial statement is concerned with the enterprise at a point in time?

A business that is not a legal entity,where there is one owner who is fully liable for all of its debts,is:

An advantage of a private company becoming a public company is:

A major (advantage/disadvantage)____________________ of a sole trader is unlimited liability.

A disadvantage of operating as a sole trader is:

A discretionary trust is

Which of the following is an advantage of being a sole trader?

Introduction to Accounting

Business Sustainability

Business Transactions

Balance Sheet

Income Statement and Statement of Changes in Equity

Statement of Cash Flows

Analysis and Interpretation of Financial Statements

Budgeting

Cost-Volume-Profit Analysis

Costing and Pricing in an Entity

Capital Investment

Financing the Business

Performance Measurement

Filters

Exam 3: Business Structures

A business which is a separate legal entity can be a:

Which of these entities is not required,under the Corporations Act,to prepare a full set of financial statements in accordance with the accounting standards?

Which of the following is not an advantage of the company form of business?

A company has which of these sets of characteristics?

The sole trader form of business organisation:

Which of the following would be a disadvantage of a private company going public?

The appropriate business structure that is popular among sporting clubs and not-for profit organisations such as charities and social groups is:

It is true that a partnership:

Which of these is not true for a public company?

A company is a legal entity.Which of these is a feature of a legal entity?

A major (advantage/disadvantage)____________________ of a partnership is mutual agency.

Private companies in Australia must have

Which financial statement is concerned with the enterprise at a point in time?

A business that is not a legal entity,where there is one owner who is fully liable for all of its debts,is:

An advantage of a private company becoming a public company is:

A major (advantage/disadvantage)____________________ of a sole trader is unlimited liability.

A disadvantage of operating as a sole trader is:

A discretionary trust is

Which of the following is an advantage of being a sole trader?

Introduction to Accounting

Business Sustainability

Business Transactions

Balance Sheet

Income Statement and Statement of Changes in Equity

Statement of Cash Flows

Analysis and Interpretation of Financial Statements

Budgeting

Cost-Volume-Profit Analysis

Costing and Pricing in an Entity

Capital Investment

Financing the Business

Performance Measurement

Filters