Chapter 3.2 Review

A business owner with __________________liability might have to pay off business debts using his or her personal money and possessions.

• unlimited

• limited

Liability is a _____________________ obligation.

• legal

• personal

The ___________________________is the simplest option for business ownership

• LLC

• Non- Profit

• Partnership

• Sole-Proprietorship

Partners share the management, profits, and liability of their business based on the terms of their ________________

• verbal agreement

• contribution to the business

• partnership agreement

• percentage share

Shareholders or stockholders are the owners of a ________________________________.

• Sole-Proprietorship

• Corporation

• Partnership

• LLC

Entrepreneurs with limited liability put their personal assets at risk.

• True

• False

The level of liability depends on the type of business ownership.

• True

• False

A sole proprietorship provides limited liability to the business owner.

• True

• False

A corporation is easier to set up than a sole proprietorship.

• True

• False

C corporations and S corporations differ in how they are taxed.

• True

• False