Module 5

owners are not personally responsible for the obligations of the company

A corporation is a separate entity from its owners where the:

a single owner actively manages the company.

A sole proprietorship is a form of business ownership in which:

statutory close corporation

A(n) _____ is a corporation that has limited number of owners that operates under simpler, less formal rules than a C corporation.

limited liability company

A(n) _____ is a form of business ownership that offers both restricted responsibility to its owners and flexible tax treatment.

conglomerate merger

A(n)__________is a combination of two firms that are in unrelated industries.

partnership

A(n)__________is a voluntary agreement under which two or more people act as co-owners of a business for profit.

A C corporation is double taxed, whereas an S corporation is taxed as a partnership.

Which of the following is a difference between a C corporation and an S corporation?

distributorship

A _____ is a type of franchising arrangement in which the franchisor makes a product and licenses the franchisee to sell it.

easier access to funding.

An advantage of franchising is:

target firm

In the context of an acquisition, the firm that is purchased by another firm is called the _____.