QUESTION A sporting goods store is owned by its user members. The store is run by managers hired by a board of directors that was elected by shareholder members. What kind of company is the store? A) a limited liability partnership B) a limited liability company C) a B corporation D) a cooperative E) a […]
Date: September 3rd, 2020
QUESTION Which of the following is NOT a benefit of being a partnership? A) having unlimited liability B) starting up the business with relative ease C) having more managerial and other expertise D) keeping your taxes relatively simple E) having more financial resources ANSWER Answer: A Explanation: A) Having unlimited liability is one of […]
Date: September 3rd, 2020
QUESTION Which of the following is NOT true of the articles of partnership? A) It has no legal binding. B) It defines the role of each partner. C) It specifies how much money each partner is to invest. D) It specifies the buy/sell arrangements if one partner wants to get out of the arrangement. E) […]
Date: September 3rd, 2020
QUESTION Which type of corporation is favored by big business, is apt to have a great many shareholders, and has its profits taxed twice? A) a general partnership B) a C corporation C) an S corporation D) an LLC E) a B corporation ANSWER Answer: B Explanation: B) A C corporation can have any […]
Date: September 3rd, 2020
QUESTION What is the type of corporation that operates in states other than the one in which it was incorporated? A) alien B) foreign C) multinational D) domestic E) quasi-public ANSWER Answer: B Explanation: B) The definition of a foreign corporation is one that operates in states other than the one in which it […]
Date: September 3rd, 2020
QUESTION Which of the following describes a subsidiary? A) Employees own stock in the company that employs them. B) It does not seek personal profit for its owners. C) It is operated by owners offering professional services. D) It operates in the United States but is incorporated in another country. E) Most of its stock […]
Date: September 3rd, 2020
QUESTION Pauline is a certified financial planner. She has chosen to set up her business such that she has the tax benefits of a sole proprietorship—one level of tax—and is free of having to worry about annual reports and shareholder requirements. What kind of company does Pauline run? A) a B corporation B) a C […]
Date: September 3rd, 2020
QUESTION Which type of corporation can have up to 100 owners, faces only one level of federal taxation, and can provide its owners with both salaries and distributions? A) an LLC B) an LLP C) a C corporation D) an S corporation E) a B corporation ANSWER Answer: D Explanation: D) An S corporation […]
Date: September 3rd, 2020
QUESTION What happens when a privately owned company goes public? A) The company now operates in several countries. B) Most of its stock is now owned by another corporation. C) It becomes an approved monopoly providing basic public services. D) Its shares can now be easily bought and sold by investors. E) Its shares can […]
Date: September 3rd, 2020
QUESTION Which of the following is NOT information you must include on an application for incorporation? A) principal business purposes B) the corporation’s minimum capital C) the company’s hours of operation D) methods for transferring shares of stock E) names and addresses of directors ANSWER Answer: C Explanation: C) Hours of operation is not […]
Date: September 3rd, 2020
