Tess and Tijuana have considered starting their own business but are concerned about the possibility of losing their personal assets if the business fails. One way for Tess and Tijuana to avoid this risk would be to organize their firm as a(n):
A) general partnership.
B) limited partnership.
C) corporation.
D) sole proprietorship.

Question

Quizplus · Accepted Answer

Organizing their firm as a corporation would provide Tess and Tijuana with limited liability, meaning their personal assets would not be at risk if the business fails. Both general partnerships and sole proprietorships do not offer this protection, while a limited partnership only provides limited liability to certain partners (the limited partners).

Tess and Tijuana Have Considered Starting Their Own Business but Are