<?xml version="1.0" encoding="us-ascii"?><InstanceReport xmlns:xsd="http://www.w3.org/2001/XMLSchema" xmlns:xsi="http://www.w3.org/2001/XMLSchema-instance"><Version>2.4.0.8</Version><ReportLongName>0006 - Disclosure - 1. GENERAL ORGANIZATION AND BUSINESS</ReportLongName><DisplayLabelColumn>true</DisplayLabelColumn><ShowElementNames>false</ShowElementNames><RoundingOption /><HasEmbeddedReports>false</HasEmbeddedReports><Columns><Column FlagID="0"><Id>1</Id><IsAbstractGroupTitle>false</IsAbstractGroupTitle><LabelSeparator>

</LabelSeparator><CurrencyCode /><FootnoteIndexer /><hasSegments>false</hasSegments><hasScenarios>false</hasScenarios><MCU><KeyName /><CurrencySymbol /><contextRef><ContextID>Context_3ME_30-Apr-2013</ContextID><EntitySchema>http://www.sec.gov/CIK</EntitySchema><EntityValue>0001363573</EntityValue><PeriodDisplayName /><PeriodType>duration</PeriodType><PeriodStartDate>2013-02-01T00:00:00</PeriodStartDate><PeriodEndDate>2013-07-31T00:00:00</PeriodEndDate><Segments /><Scenarios /></contextRef><UPS /><CurrencyCode /><OriginalCurrencyCode /></MCU><CurrencySymbol /><Labels><Label Key="CalendarSupplement" Id="0" Label="6 Months Ended" /><Label Key="Calendar" Id="1" Label="Jul. 31, 2013" /></Labels></Column></Columns><Rows><Row FlagID="0"><Id>1</Id><IsAbstractGroupTitle>true</IsAbstractGroupTitle><LabelSeparator>

</LabelSeparator><Level>1</Level><ElementName>us-gaap_OrganizationConsolidationAndPresentationOfFinancialStatementsAbstract</ElementName><ElementPrefix>us-gaap_</ElementPrefix><IsBaseElement>true</IsBaseElement><BalanceType>na</BalanceType><PeriodType>duration</PeriodType><IsReportTitle>false</IsReportTitle><IsSegmentTitle>false</IsSegmentTitle><IsCalendarTitle>false</IsCalendarTitle><IsEquityPrevioslyReportedAsRow>false</IsEquityPrevioslyReportedAsRow><IsEquityAdjustmentRow>false</IsEquityAdjustmentRow><IsBeginningBalance>false</IsBeginningBalance><IsEndingBalance>false</IsEndingBalance><IsReverseSign>false</IsReverseSign><FootnoteIndexer /><Cells><Cell FlagID="0" ContextID="" UnitID=""><Id>1</Id><IsNumeric>false</IsNumeric><IsRatio>false</IsRatio><DisplayZeroAsNone>false</DisplayZeroAsNone><NumericAmount>0</NumericAmount><RoundedNumericAmount>0</RoundedNumericAmount><NonNumbericText /><FootnoteIndexer /><CurrencyCode /><CurrencySymbol /><IsIndependantCurrency>false</IsIndependantCurrency><ShowCurrencySymbol>false</ShowCurrencySymbol><DisplayDateInUSFormat>false</DisplayDateInUSFormat></Cell></Cells><ElementDataType>xbrli:stringItemType</ElementDataType><SimpleDataType>string</SimpleDataType><IsTotalLabel>false</IsTotalLabel><UnitID>0</UnitID><Label>Organization, Consolidation and Presentation of Financial Statements [Abstract]</Label></Row><Row FlagID="0"><Id>2</Id><IsAbstractGroupTitle>false</IsAbstractGroupTitle><LabelSeparator>

</LabelSeparator><Level>2</Level><ElementName>us-gaap_NatureOfOperations</ElementName><ElementPrefix>us-gaap_</ElementPrefix><IsBaseElement>true</IsBaseElement><BalanceType>na</BalanceType><PeriodType>duration</PeriodType><IsReportTitle>false</IsReportTitle><IsSegmentTitle>false</IsSegmentTitle><IsCalendarTitle>false</IsCalendarTitle><IsEquityPrevioslyReportedAsRow>false</IsEquityPrevioslyReportedAsRow><IsEquityAdjustmentRow>false</IsEquityAdjustmentRow><IsBeginningBalance>false</IsBeginningBalance><IsEndingBalance>false</IsEndingBalance><IsReverseSign>false</IsReverseSign><FootnoteIndexer /><Cells><Cell FlagID="0" ContextID="Context_3ME_30-Apr-2013" UnitID=""><Id>1</Id><IsNumeric>false</IsNumeric><IsRatio>false</IsRatio><DisplayZeroAsNone>false</DisplayZeroAsNone><NumericAmount>0</NumericAmount><RoundedNumericAmount>0</RoundedNumericAmount><NonNumbericText>&lt;p style="font: 8pt/normal Times New Roman, Times, Serif; margin: 0; text-align: justify"&gt;California Gold Corp. (&amp;#147;California
Gold&amp;#148; or the &amp;#147;Company&amp;#148;) is a Nevada corporation whose principal focus is the identification, acquisition, and
development of rare and precious metals mining properties in the Americas. The Company is still in the exploration stage and has
not generated any revenues from its mining properties to date.&lt;/p&gt;

&lt;p style="font: 8pt/normal Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in"&gt;&amp;#160;&lt;/p&gt;

&lt;p style="font: 8pt/normal Times New Roman, Times, Serif; margin: 0; text-align: justify"&gt;The Company was incorporated on April
19, 2004 under the name of Arbutus Resources, Inc. On August 9, 2007, the Company changed its name to US Uranium, Inc. On March
9, 2009, the Company changed its name to California Gold Corp.&lt;/p&gt;

&lt;p style="font: 8pt/normal Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in"&gt;&amp;#160;&lt;/p&gt;</NonNumbericText><FootnoteIndexer /><CurrencyCode /><CurrencySymbol /><IsIndependantCurrency>false</IsIndependantCurrency><ShowCurrencySymbol>false</ShowCurrencySymbol><DisplayDateInUSFormat>false</DisplayDateInUSFormat></Cell></Cells><ElementDataType>nonnum:textBlockItemType</ElementDataType><SimpleDataType>na</SimpleDataType><ElementDefenition>The entire disclosure for the nature of an entity's business, the major products or services it sells or provides and its principal markets, including the locations of those markets. If the entity operates in more than one business, the disclosure also indicates the relative importance of its operations in each business and the basis for the determination (for example, assets, revenues, or earnings).</ElementDefenition><ElementReferences>Reference 1: http://www.xbrl.org/2003/role/presentationRef

 -Publisher FASB

 -Name Accounting Standards Codification

 -Topic 275

 -SubTopic 10

 -Section 50

 -Paragraph 2

 -URI http://asc.fasb.org/extlink&amp;oid=6927468&amp;loc=d3e6003-108592



</ElementReferences><IsTotalLabel>false</IsTotalLabel><UnitID>0</UnitID><Label>GENERAL ORGANIZATION AND BUSINESS</Label></Row></Rows><Footnotes /><IsEquityReport>false</IsEquityReport><ReportName>1. GENERAL ORGANIZATION AND BUSINESS</ReportName><MonetaryRoundingLevel>UnKnown</MonetaryRoundingLevel><SharesRoundingLevel>UnKnown</SharesRoundingLevel><PerShareRoundingLevel>UnKnown</PerShareRoundingLevel><ExchangeRateRoundingLevel>UnKnown</ExchangeRateRoundingLevel><HasCustomUnits>true</HasCustomUnits><IsEmbedReport>false</IsEmbedReport><IsMultiCurrency>false</IsMultiCurrency><ReportType>Sheet</ReportType><RoleURI>http://0001363573.com/role/GeneralOrganizationAndBusiness</RoleURI><NumberOfCols>1</NumberOfCols><NumberOfRows>2</NumberOfRows></InstanceReport>
