BLAW Exam 7 Review Questions and Answers
What are the characteristics of a sole proprietorship (2)?
1) The owner is the business
2) The simplest and most flexible business structure
What is the best opportunity for a sole proprietorship to obtain additional business capital?
Bank loans o...
what are the characteristics of a sole proprietors
what is the best opportunity for a sole proprietor
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BLAW Exam 7 Review Questions and
Answers
What are the characteristics of a sole proprietorship (2)? - answer 1) The owner is
the business
2) The simplest and most flexible business structure
What is the best opportunity for a sole proprietorship to obtain additional business
capital? - answer Bank loans or loan from the US Small Business Administration
(SBA)
When a sole proprietor does, will the business automatically dissolve? - answer Yes,
"when the owner dies, so does the business- it is automatically dissolved"
In most states, is a partnership treated as an independent entity for the purposes of
collecting judgements and having accounting performed? - answer Yes, usually can
be sued or sue, collect judgments, and have all accounting performed in the name fo
the partnership entity
When A sells a sole proprietorship to B, is this a transfer of the ownership of the
business? - answer "The sole proprietor can sell or transfer all or part of the business
to another party at any time without seeking approval".
Is intent to act in good faith an essential element of a partnership? - answer The
intent to associate is a key element of a partnership, and one can't join unless all
partners consent.
Is an employee of a partnership considered a partner? - answer They must receive a
partnership interest.
Must an agreement to form a partnership to sell real property be in writing? - answer
Yes to be legally enforceable
With respect to management decisions, must a majority of the partners agree? - answer
A majority vote controls decisions on ordinary maters connected with partnership
business
Is a single partner in a partnership entitle to information on a complete basis? - answer
Rights of partners: management, interest in the partnership, compensation, inspection
of books, accounting, and property
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