(TCO 1) Paul is the owner of Paul\'s Cabinets, which is a sole proprietorship. T

Question

(TCO 1) Paul is the owner of Paul's Cabinets, which is a sole proprietorship. The firm cannot pay its bills because a large customer defaulted on payment. Which one of the following statements is correct given this situation? (Points : 3) The creditors of Paul's Cabinets can only collect payment if Paul's Cabinets receives payment from its customer. The only course of action the creditors of Paul's Cabinets has is to sell the assets of Paul's Cabinets. The creditors of Paul's Cabinets can assume the assets of Paul's Cabinets, but only in an amount that exceeds Paul's investment in the firm. Paul is personally liable for the entire debt of Paul's Cabinets. Paul is personally liable for the firm's debts, but only to the extent of his investment in Paul's Cabinets. 2. (TCO 1) Which one of the following is classified as a current asset? (Points : 3) land accounts payable equipment inventory note payable

Explanation / Answer

The creditors of Paul's Cabinets can assume the assets of Paul's Cabinets, but only in an amount that exceeds Paul's investment in the firm. Paul is personally liable for the entire debt of Paul's Cabinets. Paul is personally liable for the firm's debts, but only to the extent of his investment in Paul's Cabinets

Related Questions

Navigate

• Browse (All)
• Browse #
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.