Exam 8: Forms of Business Ownership

Which of the following statements best describes the taxation of partnerships?

List the two basic types of partnership.

Corporations face fewer government restrictions and regulations than sole proprietorships and partnerships.

Al Tomlin and Wilson Nkata recently closed their frame shop because they could not pay the outstanding business debts.Since Tomlin and Nkata are both liable for the debts,what sort of business do they have?

Oscar Patel and Jon O'Keefe own and operate a janitorial cleaning service.Patel bought a new computer,which he plans for the company to use to track its customers,its suppliers,and for making business forecasts.Patel plans on using an installment plan to pay for the computer.O'Keefe was not asked if he thought the company needed a computer and was unhappy when he learned that he and Patel are both liable for the payments for the computer.Patel and O'Keefe have which of the following type of business?

A corporation can best be described by which of the following statements?

The development of new drugs is very expensive.For this reason Genentech,a large biotechnical company,has entered into a business arrangement with Swiss-owned Roche to develop a vaccine for tuberculosis.When the vaccine is developed or when the two biotechnical companies determine the vaccine cannot be developed using their current methodology,this relationship will dissolve.What type of relationship is it?

Which of the following is a disadvantage of sole proprietor ownership?

Who owns a corporation?

When Ashland Plastics and Melamine Chemicals formed a joint venture to develop flame-resistant plastic sheeting,the relationship most likely ended as soon as the project was completed.

The franchise agreement is best described by which of the following?

The franchisor generally does NOT provide the franchisee with which of the following?

What do a company's shareholders have the right to do?

Ralston Smythe owns Heritage Inn with four other people.All of the owners have limited financial risk.Smythe's inn is which of the following business structures?

Which form of business ownership is easiest to dissolve?

What type of liability means that business damages and/or debts can also be attached to the personal assets of the owners?

What is a disadvantage of franchising to the franchisee?

The sole proprietorship is considered a legal entity; therefore,it is taxed separately from the owner.

Jayson Tully is contemplating the purchase of a Subway restaurant franchise.Tully has made a list of the disadvantages that he faces.Which of the following is actually an advantage?

In 1984,Suzanne Pogell wanted to learn to sail,but she could find no one to teach her.She finally did convince someone to teach her to sail and,after mastering sailing,she started an all-woman sailing school called "Womanship" as a sole proprietorship.When she dies,which of the following will occur?