1. After many months in business, Horatio decides that there are some negative aspects of having a...

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Question:

1. After many months in business, Horatio decides that there are some negative aspects of having a sole proprietorship. All of the following are negatives except _____.

a)lack of money

b)lack of continuity

c)pride of ownership

d)unlimited liability

Part 2

Imelda wants to form a business in the easiest way possible. What form of business should she use?

a)Joint venture

b)Sole proprietorship

c)Partnership

d)Corporation

Part 3

Karume starts his own business as a sole proprietor. This form of business has the advantage of ____.

a)payment of only small dividends to other owners

b)guaranteed income since he is the owner

c)the owner keeping all of the profits from the business

d)steady income

Part 4

When Marquesa began her business, she did not have sufficient personal funds to own the businesses she operated so she brought in friends and family members to help with the funding. The businesses she operated were formed with an agreement, but no formal filing was required, and taxes were passed through directly to the business owners. What business form did she use to create these businesses?

a)Sole proprietorship

b)Limited liability company (LLC)

c)Partnership

d)Corporation

Part 5

Felicia and Bernard have decided to go into the quarry business together. They start by writing an agreement that explains the parameters of the business they will own and the responsibilities and roles each of them will have in the business. They have created a(n) ____.

a)business plan

b)article of partnership

c)licensing agreement

D)corporate charter

Part 6

Ismaya and Aditya have created a business together. The business was Ismaya's idea and he operates the business day-to-day. Aditya invested money in the business, but he doesn't have any management responsibilities. The main advantage for Aditya in this arrangement is _____.

a)he is only financially liable for the amount he invested in the business

b)he can withdraw his investment in the business at any time

c)he gets to participate in daily responsibilities of the business

d)he does not pay any taxes on profit earned from the business

Part 7

Serita and Tyler decide to form a partnership after discussing it for a few days. They have determined that a partnership has all of the following advantages except _____.

a)better access to money to fund the partnership

b)combined skills and knowledge

c)unlimited liability

d)ease of start-up

Part 8

Moe, Edita, and Hunter have been operating a business together as partners without a partnership agreement for several years. Hunter unexpectedly passes away, what will most likely become of the partnership?

a)Hunter's interest will automatically be divided between Moe and Edita.

b)Moe and Edita will need to find a new partner to take Hunter's place.

c)Moe and Edita will be able to purchase Hunter's interest from his estate.

d)The partnership will be immediately dissolved.

Part 9

A closed corporation is one that _____.

a)has stock that can be bought and sold by any individual

b)sells stock, but is taxed as if it were a corporation

c)has a limited number of stockholders and sales and exchanges of the stock are restricted

d)does not sell stock

Part 10

How corporations are designated changes depending on where the corporation is doing business. When a corporation is in the state in which it is incorporated it is known as a(n) ____.

a)foreign corporation

b)domestic corporation

c)alien corporation

d)public corporation

Part 11

Which of the following forms of business create a double taxation situation?

a)Limited liability company (LLC)

b)Sole proprietorship

c)Partnership

d)Corporation

Part 12

Jadyn wants to form a business that has very little government regulation. He has investigated different forms of business and determined that he will avoid forming a ____ because it is the most heavily regulated by the government.

a)sole proprietorship

b)corporation

c)partnership

d)syndicate

Part 13

One of the main advantages of corporations as a form of business is _____, or each owner's financial liability is equal to the amount of money that they have paid for the corporation's stock.

a)unlimited liability

b)the right to dividends

c)the ease of ownership transfer

d)limited liability

Part 14

When Mark Kalish and John Berthold formed their company, Envirotech, raising capital and tax implications were their biggest concerns. They wanted to avoid having the company's earnings taxed twice, but also realized that to expand Envirotech, they would need access to significant capital. Which form of business would meet the requirements for both the tax implication and access to capital for Envirotech?

a)Nonprofit corporation

b)C corporation

c)S corporation

d)Sole proprietorship

part 15

Jacques and Kelly would like to form a business that gives them protection from liability but is taxed like a partnership. They have investigated S corporations but rejected them as having too many government regulations. They should form a ____.

a)limited liability company (LLC)

b)general partnership

c)joint venture

d)corporation