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Questions and Answers
What is the definition of a sole proprietorship?
What is the definition of a sole proprietorship?
- A business structure that provides limited liability for owners
- A business owned by multiple individuals
- A business owned and operated by one person (correct)
- A business that is subject to corporate tax rates
How does having a business name affect the business entity?
How does having a business name affect the business entity?
- It makes the owner personally responsible for business debts (correct)
- It exempts the owner from liability for business debts
- It separates the business entity from the owner
- It allows the business to be taxed at corporate rates
What distinguishes corporations from sole proprietors and partnerships?
What distinguishes corporations from sole proprietors and partnerships?
- They provide limited liability for their owners/members (correct)
- They are not subject to corporate tax rates
- They are simpler and less expensive to set up
- They are owned and operated by one person
How is the taxation system different for businesses compared to corporations?
How is the taxation system different for businesses compared to corporations?
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What is a characteristic of a corporation's legal status?
What is a characteristic of a corporation's legal status?
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