Form of business ownership

1. Which of the following factors NOT affect the selection of a business?

i Control
ii Simple to create
iii Business goal
iv Division of profit
A. i & ii
B. ii & iii
C. iii & iv
D. ii & iv
2. What is the type of business that people choose to start a business?
A. Sole Proprietorship
B. Partnership
C. Corporation
D. the professional corporation
3.

An association of two or more people who coown a business for the purpose of making a
profit.
The above statement refers to the

A. Sole Proprietorship
B. Partnership
C. Corporation
D. the professional corporation
4. What is the important factor when choosing a form of ownership?
A. Start-up and future capital requirements
B. Management succession plans
C. Tax considerations
D. Business goals
5. Which of the following is Advantages of the Sole Proprietorship?
i Simple to create
ii Least costly form to begin
iii Total decision making authority
iv No special legal restrictions
A. i
B. i & ii
C. i,ii & iii
D. i,ii, iii & iv

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Form of business ownership

6. Which of the following are disadvantages of the Sole Proprietorship?
i Double taxation
ii Potential for personality and authority conflicts
iii Limited access to capital
iv Lack of continuity of the business
A. i & ii
B. ii & iii
C. iii & iv
D. i & iv

7.
The picture above refers to
A. Sole Proprietorship
B. Partnership
C. Corporation
D. the professional corporation
8.

Cannot participate in the day-to-day

management of a company.

Have limited liability for the partnerships debts.

The above statement refers to the

A. General partners
B. Limited partners
C. Nominal partners
D. Separate partners
9. X is a corporation which is doing business in a state other than the
state in which it is incorporated. X refers to
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Form of business ownership

A. Domestic
B. Alien
C. State
D. Foreign
10.

Which of the following are disadvantages of the corporation?

i Cost and time of incorporation process
ii Potential for personality and authority conflicts
iii Unlimited liability of at least one partner
iv Potential loss of control by founder
A. i & ii
B. ii & iii
C. iii & iv
D. i & iv

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