Soleproprietors and Partnerships Flashcards
Name the three kinds of Partnerships
General Partnerships, Limited Partnerships, Limited Liability Partnerships
Advantages for Soleproprietor
easy setup, inexpensive, few licensing/reg requirements, complete control of business, tax benefits (business losses can be applied to personal)
Disadvantages of Soleproprietor
unlimited liability, limited management expertise, limited ability to raise money tax
- income of business added to personal tax
A Soleproprietor must file a ____ if they are not using their own name
Declaration of Trade Name
A Soleproprietor has no separate ____ ____ (The owner and the business are one)
legal entity
2 or more people in business to make a profit together
Partnership
What partnership has partners that act as agents
General Partnership
Fiduciary Duty
act with utmost good faith, honesty, integrity, and can’t make secret profit
What kind of partnership must file a Declaration of Trade Name? (if not using their names)
General Partnership
General partnerships are _____ liable for their employees
Vicariously
What partnership is jointly and severally liable?
General Partnerships
What kind of liability does a general partnership have?
Unlimited Liability
Advantages to a General Partnership
share work load, more expertise, more credit and capital, tax benefit (business losses can be applied to personal)
Disadvantages to a General Partnership
unlimited liability, partners share equal losses of the partnership (business fail=personal and partnership assets are at risk)
Limited Partners means
the are like a shareholder, investing in the business but not allowed to work in the business
Main difference between general and limited partnerships
limited has partners who only invest in the business who are not allowed decisions nor their names on the business
By having these partners (like shareholders) in the business, it allowed them to get more money
Limited Partners
The name of business cannot include any _____ partners names
Limited
A limited partnership must file a _____ form to form
Certificate
In a limited partnership one partner must have ____
Unlimited Liability
Limited partners are liable for what?
The amount that they have personally invested
Advantages for a Limited Partnership
They have limited liability up to the amount they have invested, more credit and capital, others to share the work load, more expertise
Disadvantages of Limited Partnerships
general partner(s) have unlimited liability and liable for limited partners, limited partners have no control in business
LP
Limited Partnership
