Question 1

Michael owns 100 shares of stock in the Samson Electricals Corporation, but as a stockholder he does not have the right to vote in stockholders' meetings. In this scenario, Michael owns common stock.

Accepted Answer

A) True 
 B)False

Question 2

A general partnership avoids the problem of _________ endemic to corporations.

Accepted Answer

A)  disagreements
B)  unlimited liability
C)  double taxation
D)  withdrawal

Question 3

Which of the following is a consequence of a corporation being a separate entity from its owners?​

Accepted Answer

A)  The owners are not personally responsible for the obligations of a company.
B)  The articles of incorporation are not required to set up a corporation.
C)  A corporation cannot enter into binding contracts in its name.
D)  The death or withdrawal of an owner dissolves a corporation.

Question 4

Beany Corp. and Kaffe Inc.are leading producers and distributors of coffee beans and have joined together to become the world's largest distributor of coffee. This is an example of a(n) _____.

Accepted Answer

A)  vertical merger
B)  horizontal merger
C)  conglomerate merger
D)  upward merger

Question 5

Sole proprietors have _________ for the debts of their companies.

Accepted Answer

A)  no liability
B)  limited liability
C)  unlimited liability
D)  shared liability

Question 6

As an artificial person, a _________ can legally engage in virtually any business activity a natural person can pursue, including owning property, entering into binding contracts, and initiating legal actions.

Accepted Answer

A)  partnership
B)  corporation
C)  limited liability company
D)  sole proprietorship

Question 7

Which of the following would be an example of a corporation?

Accepted Answer

A)  Sparkles is a business firm owned by a single person who takes up complete liability for the business.
B)  The owners of Octave Inc. are not personally responsible for the debts and obligations of the firm.
C)  The profits earned by Luxe Clothing are legally considered as the income of the firm's owners.
D)  The dissolution of Nutrimax Pizzas results in its owners having to repay the debts of the firm.

Question 8

List and describe any two forms of business ownership.

Accepted Answer

A corporation is a business entity creat...

Question 9

Which of the following is an advantage of general partnerships?

Accepted Answer

A)  Partners can share the burden of running the business.
B)  All partners have limited liability.
C)  If a partner withdraws, his investment stays with the company.
D)  Partnerships have no scope for disagreements.

Question 10

A sole proprietorship is a form of business ownership in which:

Accepted Answer

A)  a business is considered a legal entity that is separate from its owners.
B)  a single owner actively manages a company.
C)  two or more people act as co-owners of a company.
D)  the owners of a business are offered limited liability and flexible tax treatment.

Exam 6: Business Formation: Choosing the Form that Fits

Which of the following is an advantage of general partnerships?

Correct Answer
verified

As an artificial person, a _________ can legally engage in virtually any business activity a natural person can pursue, including owning property, entering into binding contracts, and initiating legal actions.

Correct Answer
verified

Which of the following would be an example of a corporation?

Correct Answer
verified

A general partnership avoids the problem of _________ endemic to corporations.

Correct Answer
verified

List and describe any two forms of business ownership.

Correct Answer
verified
A corporation is a business entity creat...
View Answer

Michael owns 100 shares of stock in the Samson Electricals Corporation, but as a stockholder he does not have the right to vote in stockholders' meetings. In this scenario, Michael owns common stock.

Correct Answer
verified

Sole proprietors have _________ for the debts of their companies.

Correct Answer
verified

Which of the following is a consequence of a corporation being a separate entity from its owners?

Correct Answer
verified

Beany Corp. and Kaffe Inc.are leading producers and distributors of coffee beans and have joined together to become the world's largest distributor of coffee. This is an example of a(n) _____.

Correct Answer
verified

A sole proprietorship is a form of business ownership in which:

Correct Answer
verified

Exam 6: Business Formation: Choosing the Form that Fits

Which of the following is an advantage of general partnerships?

Correct AnswerverifiedShow Answer

As an artificial person, a _________ can legally engage in virtually any business activity a natural person can pursue, including owning property, entering into binding contracts, and initiating legal actions.

Correct AnswerverifiedShow Answer

Which of the following would be an example of a corporation?

Correct AnswerverifiedShow Answer

A general partnership avoids the problem of _________ endemic to corporations.

Correct AnswerverifiedShow Answer

List and describe any two forms of business ownership.

Correct AnswerverifiedA corporation is a business entity creat...View AnswerShow Answer

Michael owns 100 shares of stock in the Samson Electricals Corporation, but as a stockholder he does not have the right to vote in stockholders' meetings. In this scenario, Michael owns common stock.

Correct AnswerverifiedShow Answer

Sole proprietors have _________ for the debts of their companies.

Correct AnswerverifiedShow Answer

Which of the following is a consequence of a corporation being a separate entity from its owners?​

Correct AnswerverifiedShow Answer

Beany Corp. and Kaffe Inc.are leading producers and distributors of coffee beans and have joined together to become the world's largest distributor of coffee. This is an example of a(n) _____.

Correct AnswerverifiedShow Answer

A sole proprietorship is a form of business ownership in which:

Correct AnswerverifiedShow Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified
A corporation is a business entity creat...
View Answer

Correct Answer
verified

Correct Answer
verified

Which of the following is a consequence of a corporation being a separate entity from its owners?

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified