final revision - Chapter 5 Multiple Choice Circle the Best...

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Chapter 5: Multiple Choice – Circle the Best Answer 1. Which form of ownership is the most common? a. Corporations b. Master limited partnerships c. General partnerships d. Sole proprietorships 2. One of the problems with a ____________________ is that there is no one with whom to share the burden of management a. Sole proprietorship b. Limited partnership c. S corporation d. Limited liability company 3. If you are interested in starting your own business, you want to minimize the hassle and you don’t want to have anyone tell you what to do, you should organize your business as a(n): a. S corporation b. Limited partnership c. Sole proprietorship d. Closed corporation 4. At Sound Off, a store that buys and sells used c.d.’s, there is only one owner, Sonia. She spends all her time running the business, and makes all the decisions. Sonia’s mother and brother put up money for her to buy the store, but they work full time at other jobs and have no management say in the running of Sound Off. This is an example of a: a. General partnership b. Master limited partnership c. S corporation d. Limited partnership 5. When going into a partnership, you should always: a. Put all terms of the partnership into writing, in a partnership agreement. b. Make sure that you have limited liability while you are in charge c. Make sure all the profits are reinvested into the company d. Divide the profits equally 6. One of the benefits a general partnership has over a sole proprietorship is a. Limited liability b. More financial resources c. Easy to start d. A board of directors to help with decision 7. The owners of a c orporation are called
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a. General partners b. Stockholders c. Limited partners d. Proprietors 8. All of the following are advantages of a corporation except: a. Unlimited liability b. The amount of money for investment c. The ease of changing ownership d. Ability to raise money from investors without getting them involved in management 9. ____________ can be both an advantage and disadvantage of a conventional corporation, they have the ability to raise large amounts of money and hire experts, but can become inflexible and tied down in red tape. a. Size b. Tax returns c. Termination d. Limited liability 10. When Jeanne-Marie Delacourt was born, her American grandmother bought her 10 shares of Disney stock. As Jeanne-Marie grows, so will her investment. However, if Disney should happen to go out of business: a. Jeanne-Marie will be responsible for some of the debt of Disney b. Jeanne-Marie will have to go to court to show she has no involvement in the firm c. Jeanne-Marie will only lose the value of her shares d. Jeanne-Marie will have to borrow money from her grandmother to pay for the value of her shares.
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This note was uploaded on 01/29/2012 for the course BUSINESS A bus102 taught by Professor Samia during the Spring '11 term at MSA University.

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final revision - Chapter 5 Multiple Choice Circle the Best...

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