Business organizations

What is a franchise?

• A business owned and managed by a single individual
• A business operated under an authorization to sell a company's goods or services
• A business owned by stockholders
• A business established under a partnership agreement

What is a benefit of a corporation?

• Easiest to start
• Unlimited life
• Single owner keeps all the profits
• No special taxes

What does 'limited life' refer to in the context of business ownership?

• The ability to raise capital
• The situation in which a firm ceases to exist when an owner dies, quits, or sells the business
• The shared profit in a partnership
• The financial responsibility of business owners

What is a disadvantage of a sole proprietorship?

• Hard to hire top talent
• Unlimited life
• Limited liability
• Taxed once as personal income

What is an advantage of a partnership?

• Limited liability
• Ability to raise capital
• Easiest to start
• Combined business skills and knowledge

What is a disadvantage of a corporation?

• Double taxation
• Limited liability
• Ability to raise capital
• Unlimited life

What is an advantage of franchising?

• Management regulation
• Large start-up costs
• Brand recognition
• Shared profit

What is a stock in a corporation?

• Financial statement of the business
• A share of ownership in a corporation
• A tax form for business owners
• A legal document for starting a business

What is the financial responsibility of business owners in a limited liability situation?

• Owners are fully responsible for all losses and debts of the business
• Owners are responsible for shared profits
• Owners are only responsible for what they invested in the business
• Owners have no financial responsibility

What is a key advantage of a corporation?

• Shared profit
• limited life

• Single owner keeps all the profits
• Limited liability