Assignment:
PLEASE ANSWER ALL
1. When choosing an organizational type, what important factors should you consider?
A-Starting capital and hours you have available to work
B-Your business location.
C- Control versus responsibility, and risk tolerance
D-Supplier capabilities and retail outlets
2. Sanjay has three children and is starting a new company. He is looking down the road to a future time when his children are grown and could take over the business. Given his future wishes, what question is most important for him to consider when establishing his new business?
A-If I am more of a risk taker, what business entity suits me best?
B-How can I spend the least amount of money to form my business entity?
C-Which type of legal structure pays the lowest tax rate?
D- What is the best business entity and structure setup for continuity and transferability?
3. Which of the following is a characteristic of a sole proprietorship?
A-The owner of the business is not personally liable (or responsible) if anyone sues the business.
B-The owner of the business is able to borrow funds for the business without any personal liability.
C-The owner of the business enjoys complete control over all aspects of the business.
D-The owner pays corporate and individual taxes on all profits.
4. Nikki wants to start her own greeting card and postcard business. After looking at the costs associated with starting this business, she decided on using the least expensive form of ownership to set it up. Which of the following choices and reasons would be the least expensive form of ownership for Nikki new business?
A-A LLC because it gives her limited liability for the risks her business takes on.
B-A sole proprietorship, because she does not need to draft corporate charters, articles of incorporation and agreements with an attorney help.
C-A partnership, because Nikki could have a business partner with which to share expenses.
D-An S Corp, which would mean Nikki is not paying double taxation.