Legal Forms of Business

One common problem, and a significant reason for many new venture failures, is the entrepreneur thinks they can do everything and is unwilling to give up responsibility to others. 

• True

• False

Investors usually insist that the management team not operate the business as a part-time venture. 

• True

• False

Investors accept that the management team draws a large salary for their contributions in early operations. 

• True

• False

The proprietor is only personally liable for all aspects of the business when gross negligence occurs. 

• True

• False

In a limited partnership, the limited partners are equally liable for the debts of the partnership. 

• True

• False

The most expensive type of business to start is the partnership. 

• True

• False

In order for a corporation to be legally formed the owners have to register the name and articles of incorporation and meet statutory requirements

• True

• False

The corporation has the most continuity of the forms of business. 

• True

• False

In a limited liability partnership (LLP), the death or withdrawal of a partner dissolves the partnership. 

• True

• False

In an LLP, the transfer of interest of one limited partner is typically not allowed. 

• True

• False