Question 1

Perhaps the most important feature of a partnership agreement is its ability to resolve potential sources of conflict among partners.

Accepted Answer

A) True 
 B)False

Question 2

Each partner is an agent for the business and can legally bind other partners to business agreements.

Accepted Answer

A) True 
 B)False

Question 3

Shares the corporation itself owns are called:

Accepted Answer

A) preferred stock. 
B) bonds. 
C) treasury stock. 
D) common stock. 
A) preferred stock. 
B) bonds. 
C) treasury stock. 
D) common stock.

Question 4

One disadvantage of the proprietorship is:

Accepted Answer

A) it is the least regulated form of business ownership. 
B) limited personal liability. 
C) excessive access to capital. 
D) limited skills and abilities. 
A) it is the least regulated form of business ownership. 
B) limited personal liability. 
C) excessive access to capital. 
D) limited skills and abilities.

Question 5

Which of the following is true about choosing a limited liability company form of ownership?

Accepted Answer

A) It has no disadvantages except its newness. 
B) It is ideal for a new company but difficult to convert to with an existing company. 
C) It is inexpensive,easy to form,and covered by little regulation due to its newness. 
D) It's an excellent conversion vehicle for existing businesses that are suffering from double taxation but problematic for sole proprietorships. 
A) It has no disadvantages except its newness. 
B) It is ideal for a new company but difficult to convert to with an existing company. 
C) It is inexpensive,easy to form,and covered by little regulation due to its newness. 
D) It's an excellent conversion vehicle for existing businesses that are suffering from double taxation but problematic for sole proprietorships.

Question 6

Factors an entrepreneur should consider when choosing a form of ownership should include but not be limited to: tax considerations,liability exposure,business goals,managerial ability,etc.

Accepted Answer

A) True 
 B)False

Question 7

A corporation formed and chartered in Kansas is considered a domestic corporation when doing business in Kansas.

Accepted Answer

A) True 
 B)False

Question 8

This form of ownership is the same as a corporation in terms of legal characteristics even though Congress is considering legislation that would further simplify its formation and running.Its distinction from a corporation is made for federal income tax purposes only.

Accepted Answer

A) S-corporation 
B) Master limited partnership 
C) Sole proprietorship 
D) Limited liability company 
A) S-corporation 
B) Master limited partnership 
C) Sole proprietorship 
D) Limited liability company

Question 9

What is a limited liability company (LLC)and why would an entrepreneur choose it as a form of ownership?

Accepted Answer

A limited liability company (LLC),like a

Question 10

While the sole proprietorship is the easiest type of business to get into,it is the most heavily regulated.

Accepted Answer

A) True 
 B)False

Question 11

________ have shares that are controlled by a relatively small number of people,often family members,relatives,or friends.

Accepted Answer

A) International partnerships 
B) Publicly traded corporations 
C) Closely held corporations 
D) Privately held corporations 
A) International partnerships 
B) Publicly traded corporations 
C) Closely held corporations 
D) Privately held corporations

Question 12

Like a sole proprietorship,a partnership suffers from the disadvantage of:

Accepted Answer

A) poor capital accumulation. 
B) limited liability for all owners. 
C) double taxation of profits. 
D) the complexity of regulations under which it must operate. 
A) poor capital accumulation. 
B) limited liability for all owners. 
C) double taxation of profits. 
D) the complexity of regulations under which it must operate.

Question 13

In a partnership,the general partner(s)share their unlimited liability for the business debts with both silent and dormant partners.

Accepted Answer

A) True 
 B)False

Question 14

Silent partners are active in a business but generally are known to be members of the partnership.

Accepted Answer

A) True 
 B)False

Question 15

What are the pluses and minuses for the owners of a company in choosing to incorporate their business?

Accepted Answer

A limited partnership operates like any

Question 16

Which type of ownership is not subject to federal taxation?

Accepted Answer

A) Sole proprietorship 
B) Corporations 
C) Partnership 
D) Limited liability corporation 
A) Sole proprietorship 
B) Corporations 
C) Partnership 
D) Limited liability corporation

Question 17

A nonprofit organization uses its revenues to pursue social value rather than to create personal value for investors.

Accepted Answer

A) True 
 B)False

Question 18

What advantages does a partnership offer the entrepreneur over forming a sole proprietorship?

Accepted Answer

Division of profits;Large pool

Question 19

One major advantage of the ________ is that once the owner has paid all of the company's expenses,he/she can keep the remaining profits (less taxes,of course).

Accepted Answer

A) partnership 
B) corporation 
C) sole proprietorship 
D) limited liability company 
A) partnership 
B) corporation 
C) sole proprietorship 
D) limited liability company

Question 20

In a partnership,profits (and losses)are shared according to any ratio stated in the articles of partnership.

Accepted Answer

A) True 
 B)False

Exam 5: Choosing a Form of Ownership

Perhaps the most important feature of a partnership agreement is its ability to resolve potential sources of conflict among partners.

Each partner is an agent for the business and can legally bind other partners to business agreements.

Shares the corporation itself owns are called:

One disadvantage of the proprietorship is:

Which of the following is true about choosing a limited liability company form of ownership?

Factors an entrepreneur should consider when choosing a form of ownership should include but not be limited to: tax considerations,liability exposure,business goals,managerial ability,etc.

A corporation formed and chartered in Kansas is considered a domestic corporation when doing business in Kansas.

This form of ownership is the same as a corporation in terms of legal characteristics even though Congress is considering legislation that would further simplify its formation and running.Its distinction from a corporation is made for federal income tax purposes only.

What is a limited liability company (LLC)and why would an entrepreneur choose it as a form of ownership?

While the sole proprietorship is the easiest type of business to get into,it is the most heavily regulated.

________ have shares that are controlled by a relatively small number of people,often family members,relatives,or friends.

Like a sole proprietorship,a partnership suffers from the disadvantage of:

In a partnership,the general partner(s)share their unlimited liability for the business debts with both silent and dormant partners.

Silent partners are active in a business but generally are known to be members of the partnership.

What are the pluses and minuses for the owners of a company in choosing to incorporate their business?

Which type of ownership is not subject to federal taxation?

A nonprofit organization uses its revenues to pursue social value rather than to create personal value for investors.

What advantages does a partnership offer the entrepreneur over forming a sole proprietorship?

One major advantage of the ________ is that once the owner has paid all of the company's expenses,he/she can keep the remaining profits (less taxes,of course).

In a partnership,profits (and losses)are shared according to any ratio stated in the articles of partnership.

Entrepreneurs: the Driving Force Behind Small Business

Ethics and Social Responsibility: Doing the Right Thing

Creativity and Innovation: Keys to Entrepreneurial Success

Strategic Management and the Entrepreneur

Franchising and the Entrepreneur

Buying an Existing Business

New Business Planning Process: Feasibility Analysis,business Modeling,

Building a Bootstrap Marketing Plan

Creative Use of Advertising and Promotion

Pricing and Credit Strategies

Global Marketing Strategies

E-Commerce and Entrepreneurship

Creating a Solid Financial Plan

Managing Cash Flow

Sources of Equity Financing

Sources of Debt Financing

Location,layout,and Physical Facilities

Supply Chain Management

Managing Inventory

Staffing and Leading a Growing Company

Management Succession and Risk Management Strategies in the Family Business

The Legal Environment: Business Law and Government Regulation

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