Required information 2. There are many options on which There are many options on which type of business entity to form when running a business. There are advantages and disadvantages to each type. Choosing the correct entity will help meet the goals of the business owners. Read the case below and answer the questions that follow. Olivia, who has been sewing since a young age, decided that she would like to open a business called Gowns and Smiles, to make and sell prom and other formal dresses. While starting up, she would like to be the only owner of the business. Further, she does not want to go through a rigorous formation process, pay any fees or worry about making annual business filings for Gowns and Smiles. 2b.Which of the following would be a... Which of the following would be a drawback to choosing to open Gowns and Smiles as a sole proprietorship? I. Olivia would be personally liable for any tort actions against Gowns and Smiles. II. Olivia would be personally liable for any contract actions against Gowns and Smiles. III. Gowns and Smiles, as an entity, would have to pay income tax on any profits that were made. IV. Olivia would have to form a board of directors to manage Gowns and Smiles. Multiple Choice I and II II and III III and IV I, II and IV II and IV 2c. Regarding using the name Gowns... Regarding using the name Gowns and Smiles, which of the following is correct? I. It is a trade name. II. It cannot be used because the proprietor's name must be part of the business name of a sole proprietorship. III. Olivia would have to file a doing business as (DBA) certificate to use the name. IV. A sole proprietorship may not have a business name. Multiple Choice I and IV III and IV I only I and III I and II 2d. Assume that Olivia opens Gowns and Smiles as a sole proprietorship... following capitalization methods would Olivia be able to use? I. Take out a commercial loan. II. Take out a private loan. III. Create an equity security offering. IV. Open a commercial line of credit. Multiple Choice II and III I, II and III II only I, II and IV I and II 2e. Assume that Olivia opens Gowns and Smiles ... Assume that Olivia opens Gowns and Smiles as a sole proprietorship. The business grows extraordinarily in the first year and she would like to open a storefront. She would also like to add more principals to the business without changing the business structure. Which of the following options are available to Olivia? I. She can sell equity in Gowns and Smiles. II. She can take on a limited partner. III. She can take on a general partner. IV. She can take on a limited liability partner. Multiple Choice I, II, III and IV II only II and III I, II and IV None of the choices are correct