5-1 Types of Business Ownership

What is the liability type for a sole proprietorship?

• No liability

• Limited liability

• Shared liability

• Unlimited liability

Which type of partnership involves all partners having decision-making power and unlimited liability?

• Limited Partnership

• Limited Liability Partnership

• General Partnership

• Silent Partnership

What is a key characteristic of a Limited Liability Company (LLC)?

• Cannot raise money by selling units

• Tax liability is passed directly to owners

• Unlimited liability for all members

• Must have more than 100 members

Which type of corporation experiences 'double taxation'?

• Non-profit Corporation

• C Corporation

• B Corporation

• S Corporation

What is a Benefit Corporation (B Corporation) known for?

• Maximizing shareholder value only

• High social and environmental performance standards

• Unlimited number of shareholders

• Being exempt from taxes

Which type of business ownership is described as having a separate legal entity from its owners?

• Sole Proprietorship

• Partnership

• Corporation

• Limited Liability Company

What is a significant advantage of a public corporation?

• Exemption from financial reporting

• No government regulation

• Unlimited liability for shareholders

• Ability to sell stock and raise capital

Which type of partnership limits a partner's liability to the amount they invested?

• Limited Partnership

• General Partnership

• Joint Venture

• Limited Liability Partnership

What is a requirement for S Corporation shareholders?

• Must be U.S. citizens or permanent residents

• Must have more than 100 shareholders

• Can be other businesses

• Must be foreign citizens

What is a common feature of a Limited Liability Partnership (LLP)?

• Partners must be silent investors

• Partners have limited liability

• Partners cannot participate in management

• Partners have unlimited liability