Chapter 4 business test
Aaron Medford has invested $600 in the corporate stock of a manufacturer of offshore oil drilling equipment. If the company goes bankrupt, the most Medford could lose would be:
$600
Double taxation is a distinct advantage that corporations have over other form of ownership
False
A ___ offers the same liability protection as a corporation but may be taxed as either a partnership or a corporation
Limited liability company
The fact that a corporation has limited liability mean
Owners liabilities are limited to the amount invested
The C corporation is another term for
The convention form of corporation
The form of business ownership that easiest to dissolve is the
sole propietorship
The most common form of business organization is the
sole propietorship
A type of business entity that provides liability protection but is taxed like a partnership is a
S corporation
Of all forms of business ownership, corporations account for the largest share of both:
Sales and profits
Before selling stock to the public, a corporation must register with the:
Securities and exchange commission
Jayson Tully is contemplating the purchase of a Popeye's Chicken franchise. Tully has made a list of the disadvantages that he assumes he will face as a new business owner. Which of the following is actually an advantage?
Assistance in building plans
A coporations board of directors
Sets major corporate goals and policies
The business ownership that has the most difficulty in raising capital is
Sole propietorship
Tonya Thomas is tired of working for other people. She wants to start her own administrative services businesses and control her own work schedule. She wants to have sole responsibility for all business decisions. Thomas should form a(n):
Sole propietorship
Which type of business organization experinces the least government regulation
Sole propietorships
When Addison Wilcox buys an H&R Block franchise, he becomes a franchisee.
True
A term that means that business damages and/or debts can also be attached to the personal assets of the owners is ____ liability
Unlimited
Which of the following is an example of a disadvantage associated with a partnership
Unlimited liability
Bob Nichol and Martha Bohner own and operate a small company that bakes and sells Thunder Muffins, gigantic muffins full of blueberries, blackberries, or raspberries. They sell the muffins at a local farm that is open to the public on weekends. Since they operate the business as a partnership, they should:
Agree to share the business profits and losses
Which of the following describes a disadvantage assoiciated with a corporation
All of the above
Which of the followinf is a disadvantage of sole propietor ownership
Difficulty in raising capitol
The purchaser of a franchise is called the
Franchisee
The headquaters, seller, supplier of the service or method of operation of a franchise is called the
Franchisor
Paul Hyatt owns and operates DeepClean, a Florida-based company that cleans up mold and mildew in homes and businesses. As the sole proprietor of the business, he has unlimited liability, which means:
He is fully liable for all business debts
The franchisor generally does NOT provide the franchisee with
Help in employee selection
Stewed Tomatoes was an "all-girl power-pop trio." Its three members realized that many musicians feel stifled when making music in a sterile studio environment while the clock ticked away expensive hours, so the three girl band members created Materville Studios, a multimedia production house and recording studio in downtown Chicago. They share work responsibilities and profits equally. Materville Studios is a(n):
Parntership
Coporations face many more government restrictions and regulations than sole propietorships and partnerships
True
The coporations board of directors elects the corporate officers
True
Who owns a coporation
everyone who owns a share of stock int he corporation
Sole propietorships
have unlimited liability
A corporation
does not have a size limition
An S corporation
does not make the owners of the corporation personally liable for its debts
Double taxation in a corportation means
earning of the corporation and dividends of the shareholders both are taxed
