Business Organizations

What is a sole proprietorship?

• A business owned by two or more people

• A type of corporation

• A business owned and operated by one person

• A government-owned entity

Which is a right of a sole proprietor?

• Avoiding business taxes

• Hiring government employees

• Full control over decisions

• Exemption from debts

What is a major limitation of a sole proprietorship?

• A. Government restrictions

• B. Limited access to labor

• C. Limited ability to raise capital

• D. Limited product range

What liability does a sole proprietor have?

• No liability

• Limited liability

• Partial liability

• Unlimited personal liability

What is one advantage of a sole proprietorship?

• Shared responsibility

• Double taxation

• Simple and inexpensive to form

• Strong corporate structure

Which is a disadvantage of a sole proprietorship?

• Higher government support

• Limited hours of operation

• Unlimited personal liability

• Harder to form than a corporation

What distinguishes a limited partnership from a general partnership?

• General partners have less control.

• Limited partners have management power.

• Limited partners have limited liability and no management rights.

• General partners have limited liability.

Which is a right of a general partner?

• Passive investment

• Right to manage the business

• No voting power

• Avoiding business taxes

What is a major disadvantage of a general partnership?

• Difficult to dissolve

• Limited liability

• Each partner is personally liable for debts

• Cannot hire employees

What is a Limited Liability Partnership (LLP)?

• A corporation without liability

• A sole proprietorship with investors

• A partnership with all partners having limited liability

• A group of corporations