Which of the following is true? a. Owner in sole proprietorship has less responsibility in running his business compared to partnership b. The liability for sole proprietorship is limited compared to partnership c. The sole proprietorship business has unlimited growth potential compared to partnership d. The owner of sole proprietorship has less available capital compared to partnership

Which of the following is true? a. Owner in sole proprietorship has less responsibility in running his business compared to partnership b. The liability for sole proprietorship is limited compared to partnership c. The sole proprietorship business has unlimited growth potential compared to partnership d. The owner of sole proprietorship has less available capital compared to partnership

Principles of Accounting Volume 1

19th Edition

ISBN:9781947172685

Author:OpenStax

Publisher:OpenStax

Chapter15: Partnership Accounting

Section: Chapter Questions

Problem 3MC: Which of the following is a disadvantage of the partnership form of organization? A. limited life B....

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Limited partners benefit from which of the primary advantages? Their responsibility for the firm's debts is prorated based on their percentage of ownership. They have the opportunity to earn tax-free income. They do not face any potential financial losses They have control over the administrative affairs of the partnership. Their maximum loss cannot exceed the amount of their capital investment.
Which of the following is a reason to use a partnership as the legal form of a business? A. Partnerships avoid the difficulty of raising capital. B. Partnerships avoid the issue of mutual agency. C. Partnerships avoid the issue of double-taxation faced by corporations. D. Partnerships avoid the issue of unlimited liability.
which of the following is false regarding the partnership form of business? The potential liability of limited partners is limited to the amount they invested in the firm. Partnerships are relatively easy to start Transfer of ownership is easy for the general partners Income of the business is taxed only as the personal income of the partners General partners have unlimited liability for the debts of the firm.
Which of the following is a false statement about a partnership? O A. It is an opportunity to pool talents and resources for the company. B. A partnership must have at least two owners. OC. It is a business with two or more owners that is not organized as a corporation. OD. It is a type of corporation in which the owners have limited liability for the organization's liabilities.
Which one of the following is not an advantage of partnership? a. Less profit because profit is shared b. Increased capital c. Increased knowledge and specialist skills d. Shared risk
Any assets invested by a particular partner in a partnership ________. A. do not become a partnership asset but instead remain with the partner B. can be used only by the investing partner C. become the property of all the partners D. are the basis for all profit sharing
_____________ is a disadvantage of Partnership. a. Potential disagreements between partners b. Great range of skills c. Shared responsibilities d. More capital
Choose the correct. Which of the following is not a reason for the popularity of partnerships as a legal form for businesses?a. Partnerships may be formed merely by an oral agreement.b. Partnerships can more easily generate significant amounts of capital.c. Partnerships avoid the double taxation of income that is found in corporations.d. In some cases, losses may be used to offset gains for tax purposes.
The unlimited liabilities is disadvantage of: Select one: O a. Partnership and Sole proprietorships O b. Partnership only O c. Sole proprietorships only O d. Public corporation
1. A partnership is an association of three or more persons to carry on as co-owners of a business for profit. 2. The legal requirements for forming a partnership can be quite burdensome. 3. A partnership is not an entity for financial reporting purposes. 4. The net income of a partnership is taxed as a separate entity. 5. The act of any partner is binding on all other partners, even when partners perform business acts beyond the scope of their authority. 6. Each partner is personally and individually liable for all partnership liabilities. 7. When a partnership is dissolved, the assets legally revert to the original contributor. 8. In a limited partnership, one or more partners have unlimited liability and one or more partners have limited liability for the debts of the firm. Instructions Identify each statement as true or false. If false, indicate how to correct the statement.
1.Discuss the advantages and disadvantages of creating a partnership and say why the company format was chosen instead. 2.Discuss whether or not the creation of a partnership could hamper their ability to borrow to fund their operations. 3.Discuss he advantages and disadvantages of forming a company. 4.Discuss whether they should form a public or private company and whether the company should be unlimited or limited. If you suggest that the company should be unlimited, should the company be limited by shares or by guarantee. Give reasons for the type of company chosen. 5.Discuss how the creation of a company may impact the ability of MM, AA, BB and SS to borrow money to fund their operations. 6.Describe and discuss two (2) corporate governance theories that may assist MM, AA, BB and SS in running their business. 7.Discuss how MM, AA, BB and SS may approach the appointment of Directors to their company and whether or not any or all of them should become Directors given their…
Please explain the following statement in detail, I don't quite understand. The owner's equity of proprietorships and of partnerships makes no distinction between what is invested and what is earned. The equity of each owner is accounted for under the single heading, Capital.