Marketing Praxis_Types of Business Ownership Practice Questions from Study.com

Tyler is the sole owner and stockholder of the corporation, Tyler's Tires. Two years ago, Tyler's Tires hired Anna as the CEO. If Tyler dies, what happens to Tyler's Tires? A. Management of the company goes to next of kin B. the company will need to seek new management in order to continue operation C. Nothing, it continues to run under the direction of the CEO D. The company is immediately liquidated

Nothing, it continues to run under the direction of the CEO. Ch. 5, Lesson 4: corporations: types, advantages, disadvantages and examples

What is the difference between an S-corporation and a C-corporation? A. a C-corporation has a tax treatment that allows income and losses to flow through to each shareholder B. the level of liability afforded to shareholders is higher for an S-corporation C. an S-corporation is organized under state law and a C-corporation is registered under federal law D. a C-corporation is subject to double income taxation, while an S-corporation is not

a C-corporation is subject to double income taxation, while an S-corporation is not Ch. 5, Lesson 4: corporations: types, advantages, disadvantages and examples

What type of partnership offers no protection from personal liability for the partners? A. a general partnership B. a limited partnership C. An LLP D. all partnerships provide limited liability

a general partnership Ch. 5, Lesson 2: the basics of partnerships: types and examples

Which of the following businesses represents a sole proprietorship? A. a man who owns and operates a lawn mower repair business by himself B. sisters who make custom wedding gowns from a shop in their home C. a criminal law firm with multiple senior partners D. a consulting firm called AAA Engineering Incorporated

a man who owns and operates a lawn mower repair business by himself. Ch. 5, Lesson 1: what is a sole proprietorship? - definition, advantages, disadvantages and examples

What does someone have to file to form a limited liability company? A. articles of incorporation B. certificate of existence C. organization certificate D. articles of organization

articles of organization. Ch. 5, Lesson 3: the basics of LLCs: limited liability companies

What do you call the documentation that governs the corporation's activities? A. articles of incorporation B. bylaws C. operating agreement D. shareholder agreement

bylaws. Ch. 5, Lesson 4: corporations: types, advantages, disadvantages and examples

What type of partnership has a general partner who has full liability and a limited partner whose liability is limited to their investment in the partnership? A. all partnerships have this characteristic B. limited partnership C. limited liability partnership D. limited liability limited partnership

limited partnership Ch. 5, Lesson 2: the basics of partnerships: types and examples

How much protection from liability does a sole proprietorship offer? A. none, there is no distinction between the owner and the company B. the greatest protection since the company is separate from the owner C. limited liability, like that of a corporation D. some liability, like that of a partnership

none, there is no distinction between the owner and the company. Ch. 5, Lesson 1: what is a sole proprietorship? - definition, advantages, disadvantages and examples

What is the best explanation of pass-through taxation? A. only income is ignored at the entity level and it passes to the individual owners B. individuals are not subject to taxation, but the entity is taxed on the income C. income is passed through the entity and reported by individual owners, but losses are taken at the entity level D. both income and losses pass through the entity and are reported on the tax returns of the individual owners

only income is ignored at the entity level and it passes to the individual owners Ch. 5, Lesson 3: the basics of LLCs: limited liability companies

What document is used to govern the operations of a limited liability company? A. articles of organization B. bylaws C. member agreement D. operating agreement

operating agreement. Ch. 5, Lesson 3: the basics of LLCs: limited liability companies

Which one of the following is the partnership document that governs the rights and responsibilities of the partners? A. bylaws B. articles of agreement C. certificate of partnership D. partnership agreement

partnership agreement Ch. 5, Lesson 2: the basics of partnerships: types and examples

A sole proprietorship must register with which of the following? A. the Secretary of state B. the US Small Business Administration C. the agency regulating business organizations in their county D. there are no registration requirements

the agency regulating business organizations in their county Ch. 5, Lesson 1: what is a sole proprietorship? - definition, advantages, disadvantages and examples