Quiz Chapter 5 + 6.docx

Quiz Chapter 5 + 6.docx - Chapter 5 6 1A 2C 3A 4D 5C 6C 7A...

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Chapter 5 +6 1A 2C 3A 4D 5C 6C 7A 8C 9A 10A 11C 12A 13C 14A 15A Question 1 (2 points) Unlimited liability means: Question 1 options: A. When you own your own business you are responsible for all the business debts. B. You are only liable for the money you invest in the business. C. As a franchisee your franchisor is responsible for the debts of the franchise. D. You are liable for whatever advertising promises your firm makes. Save Question 2 (2 points) In a partnership, a(n) __________ partner (owner) actively manages the company and has unlimited liability for claims against the firm. Question 2 options: A. unlimited B. limited C. general
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D. associate Save Question 3 (2 points) Compared to partnerships and sole proprietorships, a major advantage of the C (conventional) corporation as a form of business ownership is that it: Question 3 options: A. Has the ability to raise more money. B. Is easier and less expensive to form. C. Qualifies for simplified tax treatment. D. Creates unlimited liability for its owners Save Question 4 (2 points) Which of the following is normally considered a disadvantage of the corporate form of business? Question 4 options: A. Unlimited liability of owners. B. Difficult transfer of ownership. C. Limited life. D. Double taxation of earnings. Save Question 5 (2 points) Double taxation means: Question 5 options: A. If stockholders decide to sell their shares, they are subject to paying twice the amount of taxes on any capital gains. B. As the owner of the company, you pay twice the amount in employment taxes on yourself, as you do on your employees.
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