True or False? A sole proprietorship is a legal entity that has a sole owner who is responsible for all profits and losses.

a. True
b. False

True or False? In a partnership, a partner is personally liable for the business debts and obligations of the other partners.

a. True
b. False

True or False? Corporations account for about 62 percent of all business receipts.

a. True
b. False

Corporations are different from all other forms in what ways? (Select all that apply.)

a. Corporations require the establishment of a board of directors.

b. A corporation is a legal entity.

c. A corporation can sue and be sued, acquire and sell real property, and lend money.

d. A corporation provides limited liability.

True or False? If you want to retain earnings for expansion, an S-Corporation will enable you to do that.

a. True
b. False

True or False? A nonprofit corporation is not permitted to make a profit.

a. True
b. False

True or False? Nonprofit corporations are always tax exempt, so donors can get a tax write-off.

a. True
b. False

An LLC exhibits which characteristics of a corporation? (Select all that apply.)

a. Free transferability of interests

b. A legal entity

c. Continuity of life

d. Centralized management

e. Limited liability

True or False? Once you choose the correct legal form of organization, it should not be changed.

a. True
b. False