Business Law

Question 1

Describe methods used to protect intellectual property

Answer 1

Copyrights, patents, trademarks, licensing, and trade secrets

Question 2

Identify the basic torts relating to business enterprises

Answer 2

Fraud
Defamation
Invasions of privacy
Fiduciary duty breaches

Question 3

Types of business ownership

Answer 3

1. Sole Proprietorship
2. Partnership
3. Corporation
4. LLC

Question 4

Define Sole Proprietorship

Answer 4

Company owned solely by one person

Question 5

Pros/Cons of Sole Proprietorship

Answer 5

Pros - Simpler, easier paperwork, complete control, all profits

Cons - Unlimited liability, lack of structure, complete responsibility

Question 6

Define Partnership

Answer 6

Company owned by two or more parties

Question 7

Pros/Cons of Partnership

Answer 7

Pros: Splitting workload + costs, more cash infusion

Cons: Partner liability, personal conflicts

Question 8

Limited vs Unlmited Liability Partnerships

Answer 8

LLP (General + Limited Partners): partners don’t pay for each others’ debts

ULP: All owners are responsible for each others’ debts

Question 9

Define Limited Liability Company

Answer 9

Business owned by members, that protects owner’s personal assets from creditors/bankruptcy

Question 10

Pros/Cons of LLC

Answer 10

Pros: No “double” tax, less responsibility, flexible business structure

Cons: Self-employment tax, investor distrust,

Question 11

Define Corporation

Answer 11

A company that is a single entity separate from owners

Question 12

Pros/Cons of Corporation

Answer 12

Pros: No personal liabilities, board of directors to help, clear structure, tax-deductions

Cons: Harsher regulations, “double” taxing, less control, higher costs, harder to create

Question 13

5 most common business taxes

Answer 13

1. Income Tax
2. Estimated Taxes
3. Self-Employment Tax
4. Employment Taxes
5. Excise Tax