Part One: True or False - you may explain your answer. Six points each.

1. _________ The owner of a sole proprietorship is personally responsible for the debts of his or her business.

2. __________In order to start business as a sole proprietor, you must first file Articles of Proprietorship with the state.

3. _________A partner is liable for contracts made by his or her partner on behalf of the partnership.

4. _________The profits of a sole proprietorship are taxed directly to the sole proprietor.

5. __________The profits of a partnership are taxed to the partnership not to the individual partners.

6. _________ Corporations, unlike partnerships, are said to have unlimited life.

7. __________A written agreement that is often created when a partnership is formed is called Articles of Partnership.

8. __________Barbie and Ken form a partnership. Barbie advance $100,000.00 to the partnership; Ken advances $50,000.00 to the partnership. Barbie is entitling to 2/3 of the partnership profits.

9.__________Barbie works full time in the partnership. Ken stops by once a week to check on things. In addition to her share of the profits, Barbie is entitled to a salary for the hours worked.

10. ________The RUPA applies to a partnership if all parties agree in writing to the terms of RUPA.