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Abm002 - TG - Day 05 Enumerating The Forms of Business Organization
Abm002 - TG - Day 05 Enumerating The Forms of Business Organization
Review
Before we start our new lesson, let us first have a
review of what we had last meeting. Let’s see what you
remember!
TRUE or FALSE. Write True if the statement about accounting information user is correct, false if not.
________1. Accounting information is used only by external users with a financial interest in a business
enterprise.
________2. The only users of financial information are the owners of a business.
________4. External users of accounting information are managers who plan, organize, and run a business.
________5. External users of financial accounting information are the same users of management
accounting information.
Well- done! Now you are ready for the next topic!
Sole proprietorship
Also referred to as “single proprietorship,” a sole proprietorship is the simplest form of
business and the easiest to register, through the Bureau of Trade Regulation and
Consumer Protection (BTRCP) of the Department of Trade and Industry (DTI). It is
owned by an individual who has full control/authority of its own and owns all the assets,
as well as personally answers all liabilities or losses. The fact that it is run by the
individual means that it is highly flexible and the owner retains absolute control over it.
Partnership
Corporation
A corporation is a juridical entity established under the Corporation Code and registered
with the SEC. It must be created by or composed of at least 5 natural persons (up to a
maximum of 15), technically called “incorporators.” Juridical persons, like other
corporations or partnerships, cannot be incorporators, although they may subsequently
purchase shares and become corporate shareholders/stockholders.
Developmental Activity
Alright , now that you’re done copying the concept notes, listen to the teacher
attentively and try to answer the following during the discussion. Make sure not to make
some noise, okay!
4. Which of the following is probably the most important reason for incorporating?
A. Limited liability of shareholders
B. More money for investment
C. Increased flexibility
D. Shared management
D. Proprietorship
9. A sole proprietorship is a business where all of the following are true except that:
A. The owner has complete control over decision-making
B. The proprietor is liable for losses to the extent of his or her personal assets
C. Profits are only taxed once as the proprietor’s income
D. The proprietor can sell stock to increase its capital resources
12. The limited liability associated with the corporate form of ownership results from:
A. Corporations being much less likely to experience losses
B. Corporations existing as legal entities, separate and apart from their owners
C. Lower taxes on dividends
D. The many stockholders who share liability
13. All of the following are characteristics of sole proprietorships except that
A. There is a single owner
B. Profits are taxed twice
C. Liability is unlimited
D. They may have a difficult time raising funds to expand the business
Guided Practice
<Triad Activity>. For this part of the lesson, in a group with three
(3) members each, discuss the following with your groupmates,
and answer what is asked below. Have fun!
1. What is Partnership?
Independent Practice
<Build Momentum>. kay, you did a great job in your group task. Now it’s
time to check your own understanding about the topic by answering the
following items on your own. Can you do it? Of course, you can! Remember to
work independently and never disturb your classmates. Good luck!
Answer Key: 1. A 2. A 3. A 4. D 5. D 6. A 7. A 8. D
Closure Activity
So how do you find the lesson today? Isn’t it interesting and exciting?
We are almost done. To sum up the lesson for today, kindly share what
have you learned from the topic by answering the question below:
Enrichment Activity
I can see that you want more. Additional task is provided below to deepen you
knowledge and understanding about the lesson today. Keep going!
Classify whether the given business belongs to Sole Proprietorship (SP), Partnership (P), and Corporation (C).
I guess this ends the lesson for today. Thank you for your cooperation and see you
again for the next topic.