1. Michael and Matthew will each pay their share of income tax on the business income when they file their personal income tax returns.
2. Sharon is responsible for all the debts of the business.
3. Emily and John are liable only for the amount of money they have invested in their
business.
4. When Peter and Sandy withdraw business funds for personal expenses, it is recorded
as a withdrawal.
5. Jonathan is an owner of the company. When he needed extra cash to purchase a
new home, he sold his ownership in the business on the stock market.
6. Although Joshua was at risk of losing only his own investment in the company, when he decided to pursue other interests, he needed the permission of the remaining owners to sell his share of the business.
For each scenario, state whether the business is a sole proprietorship, a partnership, or a corporation.