Q&A Hero

Q: Which of the following statements is(are) true? A.Corporations are not able to take deductions and expenses available to the proprietorship or partnership. B.Distribution of dividends is taxed once, as income of the corporation. C.Bonuses, incentives, and profit sharing are allowable ways to distribute income of the corporation. D.Corporate tax may be higher than the individual rate.

Q: In what form of business is it most difficult to change your taxable year? A.sole proprietorship B.partnership C.corporation D.LLP

Q: Which for form of organization has time limits on writing off capital losses? A.partnership B.corporation C.sole proprietorship D.LLP

Q: In a ________ capital losses can be carried forward indefinitely. A.sole proprietorship B.partnership C.corporation D.LLP

Q: Organization costs in a proprietorship are: A.amortizable over a period of 60 months. B.not amortizable. C.amortizable over a period of 45 months. D.amortizable for a period of a year.

Q: A _____ can raise capital through bonds, stock and debt. A.sole proprietorship B.partnership C.corporation D.LLP

Q: Corporations distribute profits to owners through: A.bonds. B.taxes. C.dividends. D.interest.

Q: In which form of organization would it be possible for individuals that don't have any ownership stake in the business to make decisions?A.Sole proprietorshipB.Limited partnershipC.General partnershipD.Corporation

Q: When it comes to decision making, in a limited partnership: A.there is no separation of ownership and control. B.limited partners have no control over business decisions. C.limited partners have an equal say, but no liability. D.the partners have control based on invested capital.

Q: In which form of organization does the owner have greatest control? A.Sole proprietorship B.Limited partnership C.General partnership D.Corporation

Q: Bonds can be used to raise capital in which form of ownership? A.Sole proprietorship B.Limited partnership C.General partnership D.Corporation

Q: The legal form of business with the most alternatives for raising capital is the: A.proprietorship. B.corporation. C.limited partnership. D.full partnership.

Q: In an S corporation, the transfer of interest can occur: A.only with the consent of the other shareholders. B.only if there is a charter provision for doing so. C.only as long as the buyer is an individual. D.depending on the agreement.

Q: In which of the legal forms of ownership is transferability of interest the easiest? A.Sole proprietorship B.Limited partnership C.General partnership D.Corporation

Q: Sole proprietorships: A.have no time limit on how long they may exist. B.are perpetual. C.continue even upon the death of the owner. D.allow a member of the deceased partner's family take over as a partner.

Q: Which of the following types of ownership has the most continuity? A.General partnership B.Corporation C.Limited partner D.Sole proprietorship

Q: Which type of ownership is the most expensive to start? A.Corporation B.General partnership C.Limited partner D.Sole proprietorship

Q: Which type of ownership is the least expensive to start? A.Corporation B.General partnership C.Limited partner D.Sole proprietorship

Q: In a limited liability partnership (LLP) death or withdrawal of a partner: A.results in automatic transfer of ownership to surviving partner(s). B.may result in problems trying to find a market for the shares. C.always results in termination of the partnership. D.has no effect on the partnership.

Q: Liability is one of the most critical reasons for establishing a: A.limited liability company. B.corporation. C.partnership. D.sole proprietorship.

Q: In a limited partnership, the limited partners: A.are liable only for the amount of their capital contributions. B.share the amount of personal liabilities equally. C.have only insurance as protection against liability suits. D.are allowed to decide on the amount of individual liabilities.

Q: _____________ have unlimited liability for the actions of the business. A.Limited liability company members B.Corporate shareholders C.General partners D.Limited partners

Q: The management team of a new venture: A.is encouraged to operate the business as a sideline. B.must operate the business full-time. C.can expect to draw a large salary. D.should be employed elsewhere to assure adequate income.

Q: Sara Blakely got the idea for her company when: A.She was a salesperson and disliked the look of pantyhose and open toed shoes. B.She was in a graduate class where her team developed the idea. C.Her family asked her to take over the business after finishing graduate school. D.She was working as a salesperson and listened to complaints of customers.

Q: Once the board of advisors have been hired, the entrepreneur should not question their advice.

Q: A board of advisors has less decision making authority than a board of directors does.

Q: The board of directors should be an even number of members.

Q: The Sarbanes-Oxley Act reduced the responsibilities of the board of directors.

Q: The hiring process is one area of business operation that the entrepreneur should not cut back on to save time.

Q: When hiring employees for the venture, the entrepreneur should consider the candidate's skills and abilities and avoid considering the individual's personality.

Q: The standard term of a limited liability company is 30 years.

Q: Shares of stock are issued to members of a limited liability company.

Q: The limited liability company is the only form of organization that allows members to share liability.

Q: In a limited liability company, every member has limited liability.

Q: The S corporation cannot have more than 75 shareholders.

Q: The S corporation can deduct most fringe benefits for shareholders.

Q: Shareholders in an S corporation have the same liability protection as shareholders in a C corporation.

Q: An S Corporation combines the tax advantages of the partnership and the corporation.

Q: The limited liability company is automatically taxed as a corporation.

Q: Since a corporation is recognized as a separate tax, it has the advantage of being able to take many deductions and expenses that are not available to the proprietorship or partnership.

Q: Income from the partnership is taxed twice: once at the business level and once as personal income.

Q: Sole proprietorships usually use a calendar year for tax purposes.

Q: Both partnerships and proprietorships serve as nontaxable conduits of income for their owners.

Q: The partnership is the most attractive type of business formation for raising capital.

Q: Corporations distribute profits primarily through dividends.

Q: Corporations are not able to distribute profits to shareholders.

Q: In the partnership, profit and loss distribution is determined by the partnership agreement.

Q: Stockholders in a corporation share day-to-day control of the entrepreneur.

Q: The limited partners in a venture share control of day-to-day operations with the general partners.

Q: The sole proprietorship form of ownership gives owners the most control of business operations.

Q: The only source of capital for a corporation is the sale of shares of stock.

Q: Sole proprietors can access two sources of capitalpersonal contributions from the entrepreneur and sale of stock.

Q: Transferability of interest is easiest in a limited partnership.

Q: In an S Corporation, ownership can be freely transferred as long as the buyer is an individual.

Q: In an LLP, the transfer of interest of one limited partner is typically not allowed.

Q: In a limited liability partnership (LLP), the death or withdrawal of a partner dissolves the partnership.

Q: The corporation has the most continuity of the forms of business.

Q: In a partnership, the death of a general partner generally does not result in termination of the partnership.

Q: The corporation can be created only by statute.

Q: In order for a corporation to be legally formed the owners have to register the name and articles of incorporation and meet statutory requirements.

Q: The most expensive type of business to start is the partnership.

Q: In a partnership, the general partners usually share the amount of personal liability according to their capital contributions.

Q: In a limited partnership, the limited partners are equally liable for the debts of the partnership.

Q: The corporation is considered a legal person that is taxable and absorbs liability.

Q: The proprietor is only personally liable for all aspects of the business when gross negligence occurs.

Q: The decision regarding the legal form of organization should be made by the entrepreneur before request for venture capital.

Q: Investors accept that the management team draws a large salary for their contributions in early operations.

Q: Investors usually insist that the management team not operate the business as a part-time venture.

Q: Sara Blakely has amassed a net worth of over $1 billion.

Q: Identify the 4 major considerations in distribution channel selection.

Q: Discuss the major factors that should be considered in setting a product/service price.

Q: Give examples of what types of goals should be set in the goals and objectives section.

Q: List the 4 major factors of the external environment identified by the marketing system.

Q: Identify and explain the three basic questions a marketing plan should answer.

Q: Identify, in order, and briefly explain each step of conducting market research giving examples where appropriate.

Q: If the entrepreneur is constantly faced with significant changes in the marketing strategy, then it is likely that: A.there is insufficient monitoring of the plan. B.the plan was not prepared properly. C.the business marketing effort does not support the strategy. D.there have been too many external factors that were difficult to predict.

Q: Which of the following is true of implementing a market plan? A.It is meant to be a tentative plan by the entrepreneur to a specific strategy. B.It need not be assigned to an individual for coordinating and implementing the plan. C.It is a formality that serves as a superficial document to outside financial supporters or suppliers. D.It is a commitment to make adjustments as needed or dictated by market conditions.

Q: In business-to-business which advertising and promotion method would be the least likely to be used? A.Trade magazines B.Direct sales C.Trade shows D.TV ads

Q: Business-to-business marketing involves: A.sales to households for personal consumption. B.a more direct channel of distribution than consumer markets. C.selling products such as household furniture. D.selling products and services through certified representatives.

Q: Which form of promotion is too expensive for most entrepreneurs to use? A.TV B.Print Ads C.Radio D.Webpage