REVISION FORM OF BUSINESS

A sole trader is:

• a) Owned by multiple individuals

• b) A legal entity separate from its owner.

• c) Operated by a single individual

• d) Governed by a board of directors.

In a sole trader business, who is personally liable for the business debts?

• a) Shareholders

• b) Partners

• c) Board of Directors

• d) Owner

Which of the following best describes the tax liability of a sole trader?

• a) The business itself pays taxes on its income.

• b) The owner's personal income is taxed, including business profits.

• c) The business pays taxes only if it is profitable.

• d) Taxes are shared among all partners in the business.

In a general partnership, the partners have:

• a) Limited liability for the partnership's debts

• b) Equal shares of ownership and decision-making.

• c) No responsibility for each other's actions.

• d) No legal requirement to draft a partnership agreement.

What type of partnership limits the liability of some partners but not others?

• a) Limited partnership

• b) General partnership

• c) Limited liability partnership

• d) Joint venture

A corporation is a legal entity that is:

• a) Owned by a single individual.

• b) Owned by multiple individuals called shareholders.

• c) Managed by a sole proprietor.

• d) Not subject to government regulations.

Which term refers to the individuals elected to oversee the management of a corporation?

• a) Partners

• b) Owners

• c) Board of Directors

• d) Sole traders

What is a key advantage of a corporation in terms of liability?

• a) Shareholders have unlimited personal liability

• b) Shareholders' personal assets are protected from business debts.

• c) The corporation is exempt from taxes.

• d) The corporation is not subject to legal proceedings.

How do shareholders participate in the profits of a corporation?

• a) By receiving dividends based on their ownership shares.

• b) By receiving fixed salaries from the corporation.

• c) By sharing profits equally with all employees.

• d) By receiving interest payments from the corporation.

Which of the following is the disadvantage of sole trader?

• A. Greater control.

• B. Disagreement

• C. Tax liability

• D. Lack of continuity.