QUESTION 1

Lisa started a small catering business in her home. She worked on her own. This business is a:

	a.	General partnership.
	b.	Corporation.
	c.	Sole proprietorship.
	d.	Limited liability partnership.

QUESTION 2

If Lisa wanted to call her business "Lisa's Lunches", she would have to register under the:

	a.	Partnership Act.
	b.	Corporations Act.
	c.	Sole Proprietors Act.
	d.	Business Names Act.

QUESTION 3

If Lisa's Lunches borrowed $15,000 from the bank to pay someone to develop a website for her, and could not repay the loan out of business revenue, how much would Lisa be personally liable for?

	a.	As much as she invested in the business
	b.	Zero
	c.	$20,000
	d.	$15,000

QUESTION 4

Lisa's sisters, Janice and Elana, decided to join her in the business. They did not have a formal arrangement, but each sister contributed some money so they could rent a commercial kitchen and expand the business. Lisa contributed $15,000, Janice contributed $10,000 and Elana contributed $5,000. What kind of business is this?

	a.	Sole proprietorship
	b.	Limited partnership
	c.	General partnership
	d.	Limited liability partnership

QUESTION 5

The sisters catered a party where the guests got food poisoning from contaminated meat. The client sued the business for $30,000. How much could Lisa be required to pay?

	a.	$10,000
	b.	$15,000
	c.	zero
	d.	$30,000

QUESTION 6

How much could Lisa recover from Elana?

	a.	$5,000
	b.	$30,000
	c.	$10,000
	d.	zero

QUESTION 7

Doreen, the sisters' mother, wanted to help her daughters succeed so she invested $20,000 in their business. She wanted to participate in the profits but did not want to be involved in running the business. What kind of business structure is this?

	a.	General partnership
	b.	Limited partnership
	c.	Limited liability partnership
	d.	Corporation

QUESTION 8

If a customer sued the business for $30,000, how much would Doreen have to pay?

	a.	$7500
	b.	Zero
	c.	$30,000
	d.	$20,000

QUESTION 9

Lisa hired a law firm, Kerbel Caplan LLP, to defend the lawsuit referred to in question 8, but Kerbel, her lawyer, missed a deadline and the business lost the lawsuit. If Lisa sued Kerbel Caplan LLP for $ 40,000 for professional negligence, how much would Caplan, the other partner, be responsible for?

	a.	$20,000
	b.	$10,000
	c.	$40,000
	d.	Zero

QUESTION 10

Lisa decided to incorporate Lisa's Lunches Limited. The three shareholders are Lisa, Janice and Elana; each contributed $10,000 in exchange for 1000 shares of the company. If Lisa's Lunches Limited could not repay its bank loan of $50,000, how much would Lisa be personally responsible for?

	a.	Zero
	b.	$10,000
	c.	$16,666
	d.	$50,000