Business Onwership Quiz for Enterepreneurship

What is a sole proprietorship?  

• A business owned by multiple individuals.

• A type of business that is considered a separate legal entity.

• A business owned and operated by one individual.

• A cooperative business model.

What is one advantage of a sole proprietorship?

• Unlimited liability for debts.

• Limited legal formalities and costs.

• Shared profits with shareholders.

• Protection from business debts.

In a sole proprietorship how is business income reported?

• On the corporation's tax return.

• On the owner's personal income tax return.

• On a separate tax return for the business.

• It's not reported at all.

What is one responsibility of a sole proprietor?

• To limit liability for debts.

• To share profits with shareholders.

• To take on all business debts and liabilities.

• To divide ownership among multiple partners.

What is a corporation?

• A business owned by one person.

• A type of business that has limited liability for its owners.

• A cooperative that share profits equally.

• A partnership between two or more individuals.

What are the owners of a corporation called?

• Sole proprietors

• Shareholders or stockholders

• Members

• Partners

What does owning a share of stock in a corporation represent?

• A loan to the corporation.

• A unit of ownership in the corporation.

• A right to manage the corporation.

• A guaranteed profit from the corporation.

What is the primary benefit of limited liability for shareholders in a corporation?

• They can make unlimited profits.

• They only risk the money they invested.

• They are responsible for all business debts.

• They have control over the corporation's day-to-day operations.

What is a cooperative?

• A business owned by shareholders.

• A business operated for the mutual benefit of its members.

• A type of corporation with no profits.

• A partnership between two businesses.

How are earnings typically shared in a cooperative?

• They are kept by the business owner.

• They are distributed as dividends to the members.

• They are taxed at a higher rate.

• Tehy are reinvested into the corporation only.