Question 1

Compared to sole proprietorships,an advantage of partnerships is their ability to obtain more financial resources.

Accepted Answer

A) True 
 B)False

Question 2

A person who  buys the right to use a business name and sell a product within a given territory is called a:

Accepted Answer

A) limited franchisor. 
B) venture capitalist. 
C) stockholder. 
D) franchisee. 
A) limited franchisor. 
B) venture capitalist. 
C) stockholder. 
D) franchisee.

Question 3

Franchising has certainly become a key component of the Canadian economy.What do you see as the major advantages and disadvantages of franchising?

Accepted Answer

Students should be able to identify and

Question 4

One disadvantage to home-based franchises is the feeling of isolation.

Accepted Answer

A) True 
 B)False

Question 5

It is usually easy to start and end a sole proprietorship.

Accepted Answer

A) True 
 B)False

Question 6

In a sole proprietorship,the equipment and profits of the business are:

Accepted Answer

A) taxed at the lowest corporate rate. 
B) the property of the owner,except for taxes owed to the government. 
C) taxed as income for the business,but are exempt from the personal income tax paid by the owner. 
D) tax-free if the appropriate exemption is filed with the local government. 
A) taxed at the lowest corporate rate. 
B) the property of the owner,except for taxes owed to the government. 
C) taxed as income for the business,but are exempt from the personal income tax paid by the owner. 
D) tax-free if the appropriate exemption is filed with the local government.

Question 7

Ellen wants to start a business.She is leaning toward setting up her company as a sole proprietorship,but she is also looking at other possibilities.Ellen has two major goals.First,given her limited personal wealth and eagerness to get started,she wants to get her business up and running with the least possible hassle and expense.Second,she wants to minimize her personal risk in the event that her company experiences difficulties.If Ellen chooses a sole proprietorship,she would:

Accepted Answer

A) achieve her second goal,since the owners of sole proprietorships are legally protected from losing more than the amount they invest in their company.However,she would find that the start-up costs would be higher than if she had incorporated her business. 
B) not achieve either goal since proprietorships are both costly to set up and subject to unlimited liability. 
C) be able to achieve both goals since this form of ownership is both the easiest to form and the least risky. 
D) meet her first goal since sole proprietorships are easy and inexpensive to form.However,she would expose herself to a high level of personal risk because owners of sole proprietorships have unlimited liability. 
A) achieve her second goal,since the owners of sole proprietorships are legally protected from losing more than the amount they invest in their company.However,she would find that the start-up costs would be higher than if she had incorporated her business. 
B) not achieve either goal since proprietorships are both costly to set up and subject to unlimited liability. 
C) be able to achieve both goals since this form of ownership is both the easiest to form and the least risky. 
D) meet her first goal since sole proprietorships are easy and inexpensive to form.However,she would expose herself to a high level of personal risk because owners of sole proprietorships have unlimited liability.

Question 8

The group farthest removed from the daily operations of a corporation are:

Accepted Answer

A) managers 
B) officers 
C) directors 
D) owners 
A) managers 
B) officers 
C) directors 
D) owners

Question 9

Twenty-six years ago,several small vineyard owners in the Niagara region joined voluntarily to market their grapes and wine in an attempt to get better prices.Over the years,they expanded the organization to include other services such as buying and selling farm supplies and equipment and providing financial and technical services.The arrangement established by these vineyard owners is an example of a:

Accepted Answer

A) co-operative. 
B) joint venture. 
C) closed corporation. 
D) limited partnership. 
A) co-operative. 
B) joint venture. 
C) closed corporation. 
D) limited partnership.

Question 10

The debts of a business operated as a sole proprietorship are considered to be the personal debts of the owner of the business.

Accepted Answer

A) True 
 B)False

Question 11

A disadvantage of co-operatives is that they are subject to higher tax rates than corporations.

Accepted Answer

A) True 
 B)False

Question 12

Although most new firms start out as sole proprietorships,few large firms are organized this way.Why is the sole proprietorship such a popular form of ownership for new firms? What features of the sole proprietorship make it unattractive to growing firms?

Accepted Answer

Sole proprietorships have many features

Question 13

The authorization from the federal or provincial/territorial government for a company to use the corporate format is known as what?

Accepted Answer

A) resolution of the board of directors. 
B) management agreement. 
C) shareholders agreement. 
D) articles of incorporation. 
A) resolution of the board of directors. 
B) management agreement. 
C) shareholders agreement. 
D) articles of incorporation.

Question 14

A separation between ownership and management is most likely to occur in a:

Accepted Answer

A) limited liability partnership. 
B) general partnership. 
C) sole proprietorship. 
D) corporation. 
A) limited liability partnership. 
B) general partnership. 
C) sole proprietorship. 
D) corporation.

Question 15

Why is size an advantage as well as a disadvantage of corporations?

Accepted Answer

Advantage - corporations have the abilit

Question 16

Ron and Jon want to go into business together.They do not want to bring in other partners,but they both want to avoid unlimited liability for any debts incurred by their new company.Ron and Jon can achieve their aims by organizing the firm as a limited partnership.

Accepted Answer

A) True 
 B)False

Question 17

Corporations are easy to start and easy to terminate.

Accepted Answer

A) True 
 B)False

Question 18

The limited liability provided to limited partners means that they are not responsible for the debts of the business beyond:

Accepted Answer

A) the firm's total assets. 
B) the amount they have invested in the company. 
C) their total personal assets. 
D) the percentage of profits they are entitled to earn. 
A) the firm's total assets. 
B) the amount they have invested in the company. 
C) their total personal assets. 
D) the percentage of profits they are entitled to earn.

Question 19

The earnings of corporations are taxed:

Accepted Answer

A) as if the business were a partnership. 
B) at twice the going rate of a partnership or proprietorship. 
C) by the federal government,but they are exempt from provincial taxes if the corporation owns any facilities within that province. 
D) as income to the corporation,then again as income to the stockholders on earnings that are distributed as dividends. 
A) as if the business were a partnership. 
B) at twice the going rate of a partnership or proprietorship. 
C) by the federal government,but they are exempt from provincial taxes if the corporation owns any facilities within that province. 
D) as income to the corporation,then again as income to the stockholders on earnings that are distributed as dividends.

Question 20

Dann is convinced that he has a great idea for a new business.Unfortunately,the type of business he wants to start would require a fairly high initial investment and Dann has a poor credit rating and very little personal wealth.Dann would be unlikely to find success if he organized his business as a sole proprietorship.

Accepted Answer

A) True 
 B)False

Compared to sole proprietorships,an advantage of partnerships is their ability to obtain more financial resources.

A person who buys the right to use a business name and sell a product within a given territory is called a:

Franchising has certainly become a key component of the Canadian economy.What do you see as the major advantages and disadvantages of franchising?

One disadvantage to home-based franchises is the feeling of isolation.

It is usually easy to start and end a sole proprietorship.

In a sole proprietorship,the equipment and profits of the business are:

The group farthest removed from the daily operations of a corporation are:

The debts of a business operated as a sole proprietorship are considered to be the personal debts of the owner of the business.

A disadvantage of co-operatives is that they are subject to higher tax rates than corporations.

Although most new firms start out as sole proprietorships,few large firms are organized this way.Why is the sole proprietorship such a popular form of ownership for new firms? What features of the sole proprietorship make it unattractive to growing firms?

The authorization from the federal or provincial/territorial government for a company to use the corporate format is known as what?

A separation between ownership and management is most likely to occur in a:

Why is size an advantage as well as a disadvantage of corporations?

Ron and Jon want to go into business together.They do not want to bring in other partners,but they both want to avoid unlimited liability for any debts incurred by their new company.Ron and Jon can achieve their aims by organizing the firm as a limited partnership.

Corporations are easy to start and easy to terminate.

The limited liability provided to limited partners means that they are not responsible for the debts of the business beyond:

The earnings of corporations are taxed:

The Dynamic Business Environment

How Economic Issues Affect Business

Competing in Global Markets

The Role of Government in Business Appendix a Working Within the Legal Environment of Business

Ethics and Social Responsibility

Entrepreneurship and Starting a Small Business

Management and Leadership

Structuring Organizations for Todays Challenges

Producing World-Class Goods and Services

Motivating Employees

Human Resource Management: Finding and Keeping the Best Employees

Dealing With Employeemdashmanagement Issues and Relations

Marketing: Helping Buyers Buy

Managing the Marketing Mix: Product, Price, Place, and Promotion

Understanding Accounting and Financial Information

Financial Management Appendix C Managing Risk

The Financial Services Industry in Canada

Filters

Exam 6: Forms of Business Ownership

Compared to sole proprietorships,an advantage of partnerships is their ability to obtain more financial resources.

A person who buys the right to use a business name and sell a product within a given territory is called a:

Franchising has certainly become a key component of the Canadian economy.What do you see as the major advantages and disadvantages of franchising?

One disadvantage to home-based franchises is the feeling of isolation.

It is usually easy to start and end a sole proprietorship.

In a sole proprietorship,the equipment and profits of the business are:

The group farthest removed from the daily operations of a corporation are:

The debts of a business operated as a sole proprietorship are considered to be the personal debts of the owner of the business.

A disadvantage of co-operatives is that they are subject to higher tax rates than corporations.

Although most new firms start out as sole proprietorships,few large firms are organized this way.Why is the sole proprietorship such a popular form of ownership for new firms? What features of the sole proprietorship make it unattractive to growing firms?

The authorization from the federal or provincial/territorial government for a company to use the corporate format is known as what?

A separation between ownership and management is most likely to occur in a:

Why is size an advantage as well as a disadvantage of corporations?

Ron and Jon want to go into business together.They do not want to bring in other partners,but they both want to avoid unlimited liability for any debts incurred by their new company.Ron and Jon can achieve their aims by organizing the firm as a limited partnership.

Corporations are easy to start and easy to terminate.

The limited liability provided to limited partners means that they are not responsible for the debts of the business beyond:

The earnings of corporations are taxed:

The Dynamic Business Environment

How Economic Issues Affect Business

Competing in Global Markets

The Role of Government in Business Appendix a Working Within the Legal Environment of Business

Ethics and Social Responsibility

Entrepreneurship and Starting a Small Business

Management and Leadership

Structuring Organizations for Todays Challenges

Producing World-Class Goods and Services

Motivating Employees

Human Resource Management: Finding and Keeping the Best Employees

Dealing With Employeemdashmanagement Issues and Relations

Marketing: Helping Buyers Buy

Managing the Marketing Mix: Product, Price, Place, and Promotion

Understanding Accounting and Financial Information

Financial Management Appendix C Managing Risk

The Financial Services Industry in Canada

Filters