Business Organizations Flashcards
Define Sole Proprietorship
an unincorporated business owned and run by one individual, with no distinction between the business and its owner.
T/F: Are there profit shares with a Sole Proprietorship
False
Define General Partnership
Consists of two or more owners who agree to be liable for the bets of the partnership/business. The liability is unlimited.
Define Limited Partnership
The partners are only liable to the extent of their contribution
Owners for a LLC are referred to as?
Members
T/F: Members are taxed as a separate business entity.
False.
What is listed on the Articles of Organization?
The names and contact information of the members of the LLC
A document that includes percentage of interests, allocation of profits and losses, member’s rights and responsibilities and other provisions is known as what?
The Operating Agreement
Define Joint Venture
A business arrangement in which two or more parties agree to pool their resources for the purpose of accomplishing a specific task.
T/F: In a joint venture, each of the participants are responsible for profits, losses and costs associated with it.
True.
What is the most recognized type of business organization?
Corporations
Define a Corporation
A body formed and authorized by law to act as a single person although constituted by one or more personals and legally endowed with various rights and duties including the capacity of succession.
Which is a reason NOT to open a Corporation?
A. A corporation provides for limited liability for its owners because it has separate legal standing from its owners
B. The owners are only liable for to the extent of their contribution.
C. The death or retirement of its owners does not terminate or dissolve the corporation
D. There are distinct tax advantages
E. A Corporation can issue shares that can be transferred with little difficulty.
B. The owners are only liable for the extent of their contribution
T/F: The Articles of Incorporation and the Bylaws are the backbone of the corporation.
True.
What do the Bylaws Explain?
The operation of the corporation
