An individual who decides to establish a sole proprietorship must realize that he or she would be: facing unlimited personal liability for the company's debts
Which of the following is a disadvantage of a sole proprietorship? The owner is personally liable for the debts of the firm
One of the dra...
FM 116 CH 6 Quiz Questions and Correct
Answers
An individual who decides to establish a sole proprietorship must realize that he or she
would be: ✅facing unlimited personal liability for the company's debts
Which of the following is a disadvantage of a sole proprietorship? ✅The owner is
personally liable for the debts of the firm
One of the drawbacks of sole proprietorships is that the owners: ✅may find it difficult to
attract and maintain talented employees
Which of the following statements is true of sole proprietorships? ✅Owner receives the
entire share of the firms' profits
Thiago has spent a long time working in various commercial establishments owned by
some of his close relatives. He now wishes to establish his own business, a sporting
goods retail store. Thiago plans to manage the store single-handedly. In the context of
the various business ownership options, Thiago's store will be an example of a: ✅sole
proprietorship
The locals residing near a small chemical factory file a complaint against it for polluting
the environment. The owner of the factory learns that if he loses the case, his personal
possessions might also be confiscated. Which of the following types of ownership is the
factory functioning under? ✅Sole proprietorship
Which of the following is a disadvantage of general partnerships? ✅Unlimited liability
Which of the following is an advantage of general partnerships? ✅Partners can share
the burden of running the business
An advantage of a general partnership is that the: ✅business is taxed as the personal
income of its owners
Max and Lucio start a retail store. They take turns to manage the store, and they share
the profits equally. Max and Lucio understand that they are personally liable for any
debts or losses that the store may incur in the future. This type of business venture
exemplifies a _____ ✅general partnership
Which of the following is a similarity between general partnerships and sole
proprietorships? ✅Both allow owners to avoid double taxation
The benefits of buying summaries with Stuvia:
Guaranteed quality through customer reviews
Stuvia customers have reviewed more than 700,000 summaries. This how you know that you are buying the best documents.
Quick and easy check-out
You can quickly pay through credit card or Stuvia-credit for the summaries. There is no membership needed.
Focus on what matters
Your fellow students write the study notes themselves, which is why the documents are always reliable and up-to-date. This ensures you quickly get to the core!
Frequently asked questions
What do I get when I buy this document?
You get a PDF, available immediately after your purchase. The purchased document is accessible anytime, anywhere and indefinitely through your profile.
Satisfaction guarantee: how does it work?
Our satisfaction guarantee ensures that you always find a study document that suits you well. You fill out a form, and our customer service team takes care of the rest.
Who am I buying these notes from?
Stuvia is a marketplace, so you are not buying this document from us, but from seller twishfrancis. Stuvia facilitates payment to the seller.
Will I be stuck with a subscription?
No, you only buy these notes for $8.99. You're not tied to anything after your purchase.
