Answer:
Wayman Corporation
Income Statement for the year ended December 31, 2021
Sales Revenue $460,000
Cost of Goods Sold ($140,000)
Gross Profit $320,000
Operating Expenses
Advertising Expense $40,000
Salaries Expense $50,000
Utilities Expense $60,000
Total operating expense ($150,000)
Operating Income $170,000
Interest Expense ($30,000)
EBT $140,000
Income tax expense ($60,000)
Net Income $80,000
Answer:
Answer for the question is given in the attachment.
Explanation:
Answer:
Sole proprietorship
The sole proprietor(not creditors but creditor) bears all losses
Explanation:
Sole proprietorship is a form of business in which there is no legal difference between the owner and the business entity as both are one and the same. The term 'sole' connotes 'only' while 'proprietorship' connotes 'owner(ship)'; it is also referred to as individual entrepreneurship. This is because only the owner of the business (the proprietor) bears all the risks (losses, debts, legal actions etc) and benefits (profits, dividends etc) of the business venture. He owns all the assets of the business venture, debts as well as the legal actions (whether positive or negative); when business is faring well, he enjoys a handsome profit and when business is struggling, he also bears the brunt of it.
The special feature highlighted in the statement above is the reality that the "creditors" refers simply and only to the proprietor (the owner of the business); in which case, if the business fails, the proprietor does not have to bother about the backlash from creditors' pressures, legal actions etc. He is the sole bearer of the losses of the business venture.
