Please answer the True/ False question below to the best of your knowledge. _____ 1. A sole proprietorship must use the cash method of accounting. _____ 2. A limited partnership must have a general partner. _____ 3. The limited liability partnership form of business offers partners protection from partnership debts. _____ 4. The owners of a limited liability company are called members. _____ 5. Partners ay taxes on their share of all the partnership net income annually. _____ 6. Limited liability companies are generally taxed as partnerships unless the company elects to be taxed as a corporation. _____ 7. A limited liability company that has only one member must be taxed as a sole proprietorship. _____ 8. The entity concept of a partnership views the partnership as separate from the partners and permits certain transactions between the partner and the partnership. _____ 9. Once established at entry, a partners basis account does not change. _____ 10. Recourse debts can only be satisfied with the property used as collateral. _____ 11. The basis limitation rules are applied after the at-risk and passive loss limitation rules. _____ 12. All partnerships are passive activities. _____ 13. A person satisfies material participation requirements only through current activity. _____ 14. Active participation requires a higher level of activity than material participation. _____ 15. A loss is never recognized on a nonliquidating distribution from a partnership. _____ 16. Only 50 percent or more of the shareholders of an S corporation must consent to the S election. _____ 17. An S corporation shareholder can only deduct losses of the S corporation if he or she has positive basis. _____ 18. The AAA of the S corporation is a corporate level account. _____ 19. S corporations do not pay any income taxes. _____ 20. There are special rules for an S corporation that must be followed when the corporation decides to liquidate.