Answer:
Sole proprietorship; unlimited; partnership; unlimited; shareholders; limited; opportunity; greater; maximize.
Explanation:
Sole proprietorship business is a type of business that is owned by a single person and as such their profits are taxed once as personal income tax. It is a type of business that is typically owned by an individual or one person and as such is solely responsible for its debts.
Sole proprietorship are the most common form of business organization, comprising about 71 percent of all firms. Each is owned by a single individual who makes all business decisions, receives all the profits, and has unlimited liability for the firm's debts.
Partnership are much like proprietorships, except that two or more individuals, or partners, share the decisions and the profits of the firm. In addition, each partner has unlimited liability for the debts of the firm.
Corporation are responsible for the largest share of business revenues. The owners, called shareholders, share in the firm's profits but normally have little responsibility for the firm's day-to-day operations. They enjoy limited liability for the debts of the firm. Corporations can be sold through stocks or shares, as a public entity.
Financial accounting is an accounting technique used for analyzing, summarizing and reporting of financial transactions like sales costs, purchase costs, payables and receivables of an organization using standard financial guidelines such as Generally Accepted Accounting Principles (GAAP) and financial accounting standards board (FASB). Accounting profits differ from economic profits, which are defined as total revenues minus total costs, where costs include the full opportunity cost of all of the factors of production plus all other implicit costs.
Opportunity cost also known as the alternative forgone, can be defined as the value, profit or benefits given up by an individual or organization in order to choose or acquire something deemed significant at the time.
Simply stated, it is the cost of not enjoying the benefits, profits or value associated with the alternative forgone or best alternative choice available.
The full opportunity cost of capital invested in a business is generally not included as a cost when accounting profits are calculated. Thus, accounting profits often are greater than economic profits. We assume throughout that the goal of the firm is to maximize economic profits.
