Formation and Organization MCQs

True Tamplin

Written by True Tamplin, BSc, CEPF®
Updated on March 25, 2022

This set of multiple choice questions (MCQs) focuses on the issues of formation and organization. You can use this quiz to help prepare for your exams, interviews, and other assessments. Click the “Start quiz” button to get going!

Formation and organization mcqs

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Frequently Asked Questions

What is the procedure for forming a company in accounting?

The first step is to select a business structure. The second step is to register with the state. This can be done online or through the mail. The third step is to get a tax ID number. The fourth step is to set up a bank account. The fifth step is to register for state and federal taxes. The sixth step is to create an accounting system. The seventh step is to establish credit with vendors. The eighth step is to begin doing business.

What are the disadvantages of forming a company in accounting?

The benefits of forming a company in accounting are that it provides structure, credibility, and liability protection. A company also allows for the pooling of resources, leading to increased efficiency and growth. Additionally, a company can offer tax advantages.

What are the disadvantages of forming a company in accounting?

What are the disadvantages of forming a company in accounting?

What is the difference between a sole proprietorship and a corporation?

A sole proprietorship is an unincorporated business owned by one person. A corporation is a separate legal entity, which means that it has its own tax ID number and can sue and be sued. Additionally, a corporation has shareholders and can issue stock.

What is the role of an underwriter?

An underwriter is a party that evaluates and assumes the risk for payment on another party’s behalf.

True Tamplin, BSc, CEPF®

About the Author
True Tamplin, BSc, CEPF®

True Tamplin is a published author, public speaker, CEO of UpDigital, and founder of Finance Strategists.

True is a Certified Educator in Personal Finance (CEPF®), author of The Handy Financial Ratios Guide, a member of the Society for Advancing Business Editing and Writing, contributes to his financial education site, Finance Strategists, and has spoken to various financial communities such as the CFA Institute, as well as university students like his Alma mater, Biola University, where he received a bachelor of science in business and data analytics.

To learn more about True, visit his personal website, view his author profile on Amazon, or check out his speaker profile on the CFA Institute website.

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