Accounting - exam

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Unit 1 & 2 theory

Last updated 4:05 AM on 5/19/26
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6 Terms

1
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How many number of owners - SOLE TRADER

1

2
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How many number of owners - PARTNERSHIP

2 - 20 (with some exceptions for large professional partnerships such as lawyers & accountants

3
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How many number of owners - SMALL PROPRIETARY COMPANY

1 - 50 non-employee shareholders

4
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Liability of owners - SOLE TRADER

UNLIMITED LIABILITY - this means the owner is personally liable for all business debts and their personal assets may be seized to settle debts.

5
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Liability of owners - PARTNERSHIP

Partnerships have UNLIMITED LIABILITY and partners are JOINTLY AND SEVERALLY LIABLE for the obligations of the business.
Meaning that all partners share responsibility for debts, and creditors can pursue any partner for the full amount owed.

6
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Liability of owners - SMALL PROPRIETARY COMPANY

LIMITED LIABILITY. The liability of owners is limited to amounts owing on their shares. Personal assets of a company’s owners can’t be seized to settle business debts