BS: Chapter 4 Review
the group of individuals elected by stockholders to oversee the general operation of a corporation are known as the
board of directors
articles of partnership are required by many states for businesses that have two or more co-owners. the issues covered usually include all of the following except
classes of stock to be issued
corporations distribute profits to there owners in the form of
dividends
Lack of control is a disadvantage of sole proprietorships.
false
all states require partnerships to have articles of partnership
false
corporations cannot be sued
false
a sole proprietorship is a popular form of business because
it is easy to form
When a group of investors borrows money to buy a company or division, using the company's assets to guarantee the loan, it is called a(n)
leveraged buyout
Charles has been asked to join a new partnership. He does not want to be liable for the firm's debts if the project should fail. He could still participate as a:
limited partner
When two companies combine to form a new company it is called:
merger
it is easier to raise funds in a partnership than in a sole proprietorship because
more people means greater earning power and credit
a private corporation is one that
owned by only a few people and not traded on the open market
the type of ownership form which can raise capital most easily is a
public corporation
which of the following forms of business organization restricts the number and type of shareholders
s-corporation
public corporations must file reports with the
securities and exchange commission
Another often used name for stockholder is _______
shareholder
the decision making process in a partnership tends to be faster when the partnership is
small
Jane discovered she is bored working for others. she wants to open a business in which she will have maximum control and the least interference from government regulation. which business form should she use?
sole proprietorship
which of the following forms of business ownerships is directly limited by the life of its owner?
sole proprietorship
which of the following requires owners to perform many functions and possess diverse skills to make decisions
sole proprietorship
the income earned by sole proprietorships is
taxed as personal income
a big advantage of the corporate form of ownership mat be the limited liability of its owners
true
a sole proprietorship has limited sources of funds, which may affect the growth of the business
true
if you want to go into business for yourself, the easiest way is a sole proprietorship
true
in a partnership, if the goals of one partner change, the result may be friction and even legal disputes
true
in most states, corporations must have corporation, incorporated, or limited in their names to show that their owners have limited liability
true
partnerships have fewer regulatory controls than corporations
true
the Government usually will scrutinize high profile mergers and acquisitions to ensure that they are not creating monopolies
true
all of the following are advantages of a sole proprietorship except
unlimited liability
according to the internal revenue service
Partners report their share of profits as personal income
the legal documents that identify the basic agreements bt partners are called
articles of partnership
In creating a corporation, once the articles of incorporation are filed with the appropriate state office, the state may then issue a corporate
contract
which of the following is a disadvantage of a partnership?
difficulty of selling ownership
in a general partnership, each partner is liable only for the debts he or she incurs
false
An important advantage of a corporation is its
limited liability
which of the following is not a source of funds for a sole proprietorship
selling stocks or issuing bonds
