Chapter 5
True or false: In a limited partnership, the liability of the limited partners is unlimited and personal assets are at risk.
False
Which is an advantage of the corporate form of business ownership?
Limited liability
Because owners are only responsible for losses up to the amount they have invested in a corporation, limited liability is considered:
a major advantage
Among the reasons that disagreements can ruin a partnership are:
arguments over dividing profits disagreement over workload opposing management styles
Selling shares of stock to anyone allows a _________ to raise more money to grow.
corporation
If you are your own boss, you are responsible for paying your own wages/salary and for your own _____ _____
fringe benefits
A sole proprietorship has a limited life span unless:
it is sold to someone else it is taken over by an heir
When a sole proprietor leaves an ongoing business to future generations, it is said that the owner is leaving a _____
legacy
Stockholders' liability for losses only up to the amount they invest is called ______________.
limited liability
The form of partnership that limits liability to the limited partner's own acts or those of the people they supervise is a:
limited liability partnership
A business that is owned and managed by one person is a(n)
sole proprietorship
If you start and manage a landscaping business on your own, you have likely started a:
sole proprietorship
True or false: The main advantage of a sole proprietorship is ease of start up.
true
The responsibility of the owner of a sole proprietorship for all of the debts of the business is ____ liability
unlimited
When you own a sole proprietorship you and the business are considered one, so you have ______ liability for financial obligations such as debt.
unlimited
If your company debts or damages are solely your responsibility you could be experiencing the disadvantage associated with owning a sole proprietorship called ____ _____
unlimited liability
In a sole proprietorship, any debts or damages incurred by the business are your personal debts and you must pay them. This disadvantage is known as:
unlimited liability
