Forms Of Business : True/False Questions

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A Certificate of incorporation should not include the purpose of the corporation.

False

A Corporation can be owned by as few as one person and as many as thousands of people.

False

A disadvantage of a partnership that fails is that the partner can lose personal assets in addition to the amount of money invested in the business.

False

A nonprofit corporation pays dividends to shareholders.

False

A partnership continues even after one partner dies.

False

A person must own at least ten shares of stock to be considered a stockholder.

False

A stockholder has the same financial responsibility as a partner.

False

All corporations are large in size.

False

Businesses owned by one person usually have enough funds for emergency situations.

False

Corporations are many in number and generally large in size.

False

Corporations usually have a tax advantage over partnerships

False

Each stockholder has only one vote regardless of the number of shares owned.

False

Most successful entrepreneurs start their businesses when they are about 30 years old.

False

Stockholders decide when dividends are to be distributed.

False

The most common form of business ownership is a partnership.

False

The stockholders make up the ruling body of a corporation.

False

The top officer of a corporation is referred to as a CFO.

False

A Corporation can be sued in its own name.

True

A Corporation can make contracts and borrow money.

True

A Partnership could be owned by as many as ten or more partners.

True

A business plan helps entrepreneurs see the risks and responsibilities involved in starting a business.

True

Corporations sell more goods and services annually than do proprietorships and partnerships combined.

True

Financing the business is one of the responsibilities of the business owner.

True

If a partner enters into a contract against the wishes of the other partners, the other partners are legally responsible for the contract.

True

If one partner is unable to pay his or her portion of the business's debts, the other partners must pay it.

True

In a proprietorship, the owner is entitled to all profits earned by the business.

True

In a sole proprietorship, creditors have a legal claim to the business's assets before the owner.

True

It is difficult to withdraw from a partnership.

True

Stockholders elect members of the board of directors.

True

To form a corporation, a charter is needed.

True

Since a new business has not yet made a profit, a financial plan should not be included in the business plan.

false


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