A
A. has one owner
B. can issue stock
C. pays taxes on partnership income
D. can have more than one general partner
Concept Introduction:The business organization is referred to as an entity that is established to run a commercial business. The different form of business organization includes partnership, sole proprietorship, and company.
To choose:The correct option.
Answer to Problem 1MC
D. Can have more than one general partner.
Explanation of Solution
Explanation for the correct answer: A partnership is referred to as a form of business organization under which two or more than two persons join to run the legal business. The partners contribute property, services, and money in the business. A partnership has more than one general partner. Therefore, it is the correct answer.
Explanation for the incorrect answers:
A. has one owner: A partnership is formed to run a legal business by two or more than two persons. Each person in the partnership is the owner. A partnership has more than one owner. Therefore, it is an incorrect answer.
B. can issue stock: The partnership does not have a right to issue stock for raising capital. Partnership does not have securities to issue. Therefore, it is an incorrect answer.
C. pays taxes on partnership income: The partners are not liable to pay taxes on the partnership income. The partners are liable to pay personal tax. Therefore, it is an incorrect answer.
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Chapter 15 Solutions
Principles of Accounting Volume 1
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Principles of Accounting Volume 1AccountingISBN:9781947172685Author:OpenStaxPublisher:OpenStax College