Business Structures - True or False

About 85 percent of all business firms in the United States are sole proprietorships.

• True

• False

Unlimited liability holds a sole proprietor personally responsible for all the debts of the business.

• True

• False

If the owner of a sole proprietorship retires or dies, the owner's heirs may take over the business and either sell it or continue to operate it.

• True

• False

A banker or lender is more likely to make sizable loans to a sole proprietor than to a partnership.

• True

• False

The weakness of one partner may be offset by another partner's strength.

• True

• False

Because there are two or more people in a general partnership, bankers and suppliers are not concerned about unlimited liability.

• True

• False

A corporation is an artificial person created by law.

• True

• False

Corporations account for about 17 percent of all sales revenues.

• True

• False

Common stockholders have the right to elect a corporation's board of directors and vote on corporate matters.

• True

• False

Most stockholders attend a corporation's annual meeting and vote in person.

• True

• False