Business Organizations Practice #2

Advantages of this business type are that the owner is their own boss and gets to keep all the profits.

• Partnership
• Sole Proprietorship
• Corporation
• Franchise

What is a major advantage of a business that is a partnership rather than a sole proprietorship?

• The responsibility for the business is shared
• The business is easy to set up
• The partners are not responsible for business debts
• The business is easy to sell

Disadvantages for this type of business include: owner pays for everything, hard to get money to start from the bank, owner might lack skills & unlimited liability.

• Sole Proprietorship
• Partnership
• Corporation
• Franchise

What is a business owned by stockholders/investors but operated by others?

• Sole Proprietorship
• Partnership
• Corporation

What is ONE advantage of a Corporation?

• Difficult to start
• Make all of the decisions
• Easy to raise money!

Characteristics include owned by two or more people and may be general or limited

• Sole Propriotorship
• Partnership
• Corporation

Advantages include limited liability for owners, unlimited life, and ease of transfer of ownership. 

• Sole Propriotorship
• Partnership
• Corporation

What is a disadvantage of partnerships?

• ease of formation
• owners share responsibilities
• limited liability
• possibility of personality conflict

Barry and two associates have been operating a business that is not going well. Barry is stressed out because the company is over $200,000 in debt and he knows that if it goes out of business, he and his two associates will have to pay it out of their own pockets. It sounds like Barry and his two associates have a 

• partnership.
• corporation.
• sole proprietorship.
• stock.

Dan has $5,000. He wants to invest his money in the type of business that has the least amount of liability. In which type of business should he invest?

• corporation
• partnership
• proprietorship