Question 1

Financing needs are not directly related to selecting a form of business
ownership.

Accepted Answer

The financing needs of a business can influence the choice of business ownership, as different forms of ownership have varying access to capital and funding options.

Question 2

Liability is a major issue in the formation and type of ownership of a new
business enterprise.

Accepted Answer

Liability refers to the legal responsibility for any debts or obligations that a business incurs. The type of ownership chosen for a new business can have significant implications for liability, as some structures (such as sole proprietorships) can expose the owner's personal assets to business debts, while others (such as corporations) limit this risk through the concept of limited liability. Therefore, liability is indeed a major issue in the formation and type of ownership of a new business enterprise.

Question 3

"How much control do you want?" is not a major consideration when starting a
new business.

Accepted Answer

How much control one wants is indeed a major consideration when starting a new business. It determines the structure and ownership of the business, as well as the decision-making process. The answer statement is incorrect.

Question 4

It is necessary to decide if the business should survive the owner(s) in the
startup stage.

Accepted Answer

The answer of It is necessary to decide if the...

Question 5

Teeth for Life would be better suited for a _____ than a sole proprietorship.
A)LLC
B)corporation
C)partnership
D)S corporation

Accepted Answer

Teeth for Life would be better suited for a partnership because there are likely multiple dentists involved in the practice who share responsibility and decision-making. A partnership structure can allow for shared ownership and management among the dentists. An LLC or corporation may also be suitable, but a sole proprietorship or S corporation may not provide the necessary legal and financial protection for all parties involved.

Question 6

There are pros and cons for sole proprietorships and partnerships, but not
for corporations.

Accepted Answer

There are certainly pros and cons for corporations, including limited liability for shareholders but potentially higher taxes and more complex legal structures.

Question 7

As attorneys who share equal ownership, profits, and losses in their firm, Raymond James and Alexander Doss have opted for which legal form of
Business ownership?
A)partnership
B)sole proprietorship
C)limited liability corporation
D)S corporation

Accepted Answer

Raymond James and Alexander Doss have opted for a partnership, which is a legal form of business ownership where two or more individuals share equal ownership, profits, and losses. This is the most logical choice based on the information given in the question.

Question 8

If you're asking yourself whether you want to make it easy for the ownership of your new business to change hands, which of the key questions about legal form of
Ownership are you posing?
A)How much control do you want
B)Should it be possible for the business to continue without you
C)Do you want to share profits with others
D)How much liability exposure are you willing to accept

Accepted Answer

If you want to make it easy for ownership to change hands, then you should choose a legal form of ownership that allows the business to continue without you. This could be a corporation or a limited liability company (LLC) with multiple members. Both of these types of entities have perpetual existence, meaning that they can continue to operate even if one of the owners leaves or passes away. This makes it easier to transfer ownership through the sale of shares or membership interests.

Question 9

Choosing the right form of business ownership will give the owner everything
he or she desires.

Accepted Answer

Choosing the right form of business ownership is important, but it does not guarantee that the owner will receive everything he or she desires. Other factors such as market trends, competition, and external influences can also impact the success of the business.

Question 10

"What are you willing to do to set up and operate your business?" is one of the
questions you should ask yourself when choosing a form of ownership.

Accepted Answer

This statement is true. When deciding on a form of ownership, it is important to consider the level of involvement and effort required to set up and operate the business. Different forms of ownership may require different levels of responsibility and investment.

Question 11

It is imperative to decide which form of business ownership offers the features
that are most important to you.

Accepted Answer

It is important to carefully consider the various forms of business ownership (such as sole proprietorship, partnership, corporation, etc.) in order to determine which one best aligns with your goals, values, and priorities. Each form of ownership has its own advantages and disadvantages, so it is important to weigh these carefully before making a decision.

Question 12

Which legal form of organization did Ben Cohen and Jerry Greenfield choose when they started their business?
A)Sole proprietorship
B)Corporation
C)Partnership
D)S-corporation

Accepted Answer

Ben Cohen and Jerry Greenfield formed a partnership when they started their business. This is evident from the company name "Ben & Jerry's Homemade Holdings Inc." A partnership is a form of organization where two or more individuals come together to carry on a business for profit. In this case, Ben and Jerry were the two partners who started the business together.

Question 13

In deciding on a legal form of organization, you should ask yourself all of the following questions except______________.
A)do you want to share the profits with others
B)do you have all the skills needed to run the business
C)how many employees will you hire
D)what are your financing needs

Accepted Answer

The number of employees you plan to hire is not directly related to the legal form of organization, which focuses more on ownership, liability, and financial considerations.

Question 14

A very important consideration in picking a legal form of business is_________.
A)how long you plan to run the business
B)how much legal liability you are willing to accept
C)how successful you believe your business will be
D)how many competitors you expect to have

Accepted Answer

The legal liability that the owner(s) of a business are willing to accept is a crucial factor in determining the form of business. Some forms of business, like sole proprietorship, offer no legal protection for personal assets and leave the owner(s) fully liable for any debts or legal issues of the business. Other forms, like a corporation, offer limited liability, meaning the owner(s) are not personally responsible for the business's obligations. So, depending on the owner(s) risk tolerance, choosing the legal form of business is a critical decision.

Question 15

No single form of ownership will give you everything you want and you will
have to accept some tradeoffs.

Accepted Answer

No form of ownership is perfect and each has its own advantages and disadvantages. Therefore, it is necessary to make a tradeoff between different forms of ownership depending on individual needs and circumstances.

Question 16

In deciding which legal form of business ownership to choose, these professionals must ask themselves all of the following questions _____.
A)How much control do you want
B)Do you want to share profits with others
C)What are your financing needs
D)All of these are critical questions to ask.

Accepted Answer

All three questions (control, profit sharing, and financing needs) are critical in deciding the best legal form of business ownership. Therefore, it is important for professionals to thoroughly consider all options and their implications before deciding on a specific ownership structure.

Question 17

If you want to own the business yourself, you might consider setting up as a(n)__________.
A)partnership
B)sole proprietorship
C)independent owner
D)franchisee

Accepted Answer

A sole proprietorship is a business owned and operated by one person. It is the simplest and least expensive type of business organization to set up, and you have complete control and flexibility over the business. This is the best choice if you want to own the business yourself without any partners or a complicated legal structure.

Question 18

Scenario-Based
Rock City is a community in the Midwest with a population of 23,000 people.
Three dental clinics serve the city and the surrounding area.Perfect Smile is
owned and operated by the newest dentist in town, Dr.Martin Harris, who employs
one dental assistant and a secretary/receptionist.Drs.Joan Bennett and Joseph
Young jointly operate Teeth for Life and provide a few more services than Dr.
Harris.Rock City Dental Clinic has been in business for 58 years, employs 38
people, and offers a range of services that include dentures, orthodontics,
and minor oral surgery.
-Given the size of his operation and the fact that he's just opened his office, Dr.Harris is probably organized as a _____.
A)sole proprietorship
B)partnership
C)corporation
D)cooperative

Accepted Answer

A sole proprietorship is the most likely organization for Dr. Martin Harris, given that he is the sole owner and operator of his dental clinic, and only has two employees. A partnership would indicate that he has a partner, which is not stated in the scenario. A corporation or cooperative would suggest a larger and more complex organization, which is not the case for Dr.Harris.

Question 19

With enough employees and annual sales to form a company to limit the liabilities of its owners, Rock City Dental Clinic could opt to organize as a _____.
A)sole proprietorship
B)partnership
C)corporation
D)cooperative

Accepted Answer

With enough employees and annual sales to form a company to limit the liabilities of its owners, Rock City Dental Clinic could opt to organize as a corporation. This structure limits the personal liability of the owners and provides the opportunity to raise capital through the sale of stock.

Question 20

Sole proprietorship, partnership, and corporation are the three legal forms of
business ownership.

Accepted Answer

This statement is true.

Quiz 3: Selecting a Form of Business Ownership

Financing needs are not directly related to selecting a form of business ownership.

Liability is a major issue in the formation and type of ownership of a new business enterprise.

"How much control do you want?" is not a major consideration when starting a new business.

It is necessary to decide if the business should survive the owner(s) in the startup stage.

Teeth for Life would be better suited for a _____ than a sole proprietorship.

There are pros and cons for sole proprietorships and partnerships, but not for corporations.

As attorneys who share equal ownership, profits, and losses in their firm, Raymond James and Alexander Doss have opted for which legal form of Business ownership?

If you're asking yourself whether you want to make it easy for the ownership of your new business to change hands, which of the key questions about legal form of Ownership are you posing?

Choosing the right form of business ownership will give the owner everything he or she desires.

"What are you willing to do to set up and operate your business?" is one of the questions you should ask yourself when choosing a form of ownership.

It is imperative to decide which form of business ownership offers the features that are most important to you.

Which legal form of organization did Ben Cohen and Jerry Greenfield choose when they started their business?

In deciding on a legal form of organization, you should ask yourself all of the following questions except______________.

A very important consideration in picking a legal form of business is_________.

No single form of ownership will give you everything you want and you will have to accept some tradeoffs.

In deciding which legal form of business ownership to choose, these professionals must ask themselves all of the following questions _____.

If you want to own the business yourself, you might consider setting up as a(n) __________.

With enough employees and annual sales to form a company to limit the liabilities of its owners, Rock City Dental Clinic could opt to organize as a _____.

Sole proprietorship, partnership, and corporation are the three legal forms of business ownership.