Entrepreneurship Final Exam

 (p. 257) Investors usually insist that the management team not operate the business as a part-time venture. 

• True

• False

(p. 257) Investors accept that the management team draws a large salary for their contributions in early operations. 

• True

• False

p. 258) The proprietor is only personally liable for all aspects of the business when gross negligence occurs. 

• True

• False

(p. 258) The corporation is considered a legal person that is taxable and absorbs liability. TRUE

• True

• False

 (p. 259) In a limited partnership, the limited partners are equally liable for the debts of the partnership. 

• True

• False

(p. 258) In a partnership, the general partners usually share the amount of personal liability according to their capital contributions. 

• True

• False

 (p. 260) The most expensive type of business to start is the partnership. 

• True

• False

p. 260) 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

 (p. 260) The corporation can be created only by statute. TRUE

• True

• False

(p. 260) In a partnership, the death of a general partner generally does not result in termination of the partnership. 

• True

• False