Business Principles Unit 2 Review

When going into a partnership, you should always:

• divide profits equally

• make sure all the profits are reinvested into the company

• put terms of partnership into writing

• make sure that you have limited liability while you are in charge

__________ means that corporate owners and limited partners are responsible for losses.

• Unlimited Liability

• Limited Liability

When determining a form a business ownership, you should consider:

• Taxes and Liability

• Number of Employees and Bank Access

• Percentage of profits

• Liability and number of hours of work per week

What are limited partners liable for?

• The firm's total assets

• The amount they have invested in the company

• The percentage of profits they are entitled to earn

• Their total personal assets

Which of the following is an advantage of a corporation

• Ease of formation

• Lower taxes

• Simplified paperwork

• Limited liability of owners

Which of the following is an advantage of franchises?

• Management and marketing assistance

• Shared profit

• Management regulation

The limited liability company can choose to be taxed as a partnership or a corporation.

• True

• False

What do you call a written description of a business idea and how it will be carried out?

• Business Plan

• Patent

• Pitch

• Proposal

Most Americans are employed by

• Big businesses

• Mid-sized businesses

• Small businesses

• Sole proprietors

How can a small business gain an advantage over larger companies?

• spend more money on advertising

• offer personalized service

• post negative things about competition online

• hire more employees