Required The three primary types of business organization are proprietorship, partnership, and corporation. Each type has characteristics that distinguish it from the other types. In the left column of the following table, choose the name of the type of business organization that is most likely to possess the characteristic that is described in the right column of the table. The first item is shown as an example. Business Type Proprietorship Characteristic Owned and operated by a single individual Subject to double taxation Has a retained earnings account on its balance sheet One owner may be held personally liable for actions taken on behalf of the business by different owner Profits benefit a single individual Frequently uses legal agreements to define profit distribution for two or more owners Most highly regulated form of business The business dissolves with the death of its only owner Offers the least capacity to raise capital Provides the best opportunity to benefit a few people Has only one capital account on its balance sheet Provides for easy transfer of ownership Offers the highest level of control over operating decisions Has multiple capital accounts but no retained earnings account on its balance sheet Provides the greatest capacity to raise capital Least regulated form of business Usually operated by a professional management team that is separated from the owners Has two or more owners who are not stockholders