Which of the following is a primary concern when first starting your business?

• A. Selecting the appropriate legal structure for the business
• B. Calculating depreciation expense for existing assets
• C. Preparing consolidated financial statements
• D. Issuing dividends to shareholders

Answer: (A)

Verified step by step guidance

1. Understand the context of the question: When starting a business, the primary focus is on foundational decisions that will impact the business's operations and legal obligations.
2. Recognize that selecting the appropriate legal structure is crucial because it determines how the business is taxed, the level of personal liability, and the regulatory requirements the business must follow.
3. Eliminate the other options: Calculating depreciation expense for existing assets is not relevant at the start of a business, as assets are typically acquired after the business is established.
4. Preparing consolidated financial statements is a concern for businesses with subsidiaries or multiple entities, which is unlikely to be relevant at the initial stage of starting a business.
5. Issuing dividends to shareholders is a concern for established businesses with profits and shareholders, not for a newly started business.