7.02 Types of Business Ownership

A type of business ownership in which one or more of the owners does not have full liability is called a:

• General partnership
• Limited partnership
• Sole proprietorship
• Service organization

A characteristic of a sole proprietorship is that the owner:

• Has access to unlimited funds
• Receives all the profit
• Transfers all the risk
• Delegates all functions

What do business owners consider when they select a business ownership structure?

• Personal circumstances, type of business, and product mix
• Product versatility, financial needs, and advertising strategies
• Personal circumstances, financial needs, and type of business
• Product versatility, advertising strategies, and personal circumstances

To form my business, I used all of my savings and borrowed from the bank, and I'm personally liable for all of the debts. This statement is an example of which of the following forms of business ownership:

• Partnership
• Sole proprietorship
• Corporation
• Cooperative

John, Robert, and Charles were college friends who wanted to start a business. John has creative ability, Robert's expertise is selling, and Charles' expertise is management. However, each has limited capital. The ideal business ownership for these young men is a

• Merger
• Partnership
• Franchise
• Corporation

If all of the individuals who own a business share unlimited liability for the business's losses, these individuals are part of a(n)

• Private Corporation
• General partnership
• S Corporation
• C Corporation

Lois and Lora plan to open a florist shop. Lois is unable to devote full time to the daily operations of the shop but wishes to provide financial support. Which form of business partnership is most likely to appeal to Lois?

• Private
• Nonprofit
• General
• Limited

The Scott Company decided to sell stock to raise capital. Under what form of business organization does the company operate?

• Corporation
• Cooperative
• Partnership
• Sole proprietorship

What type of corporation may be owned by just a few people and does not offer its shares for sale to the general public?

• Limited
• Franchise
• C Corporation
• Private

A type of state-chartered corporation that was developed to help small businesses by taxing them as individuals in a partnership is a(n) __________ corporation.

• S Corporation
• C Corporation
• Private
• Limited