Podcast
Questions and Answers
What is a characteristic of a sole proprietorship?
What is a characteristic of a sole proprietorship?
- It is owned by multiple stockholders.
- It shares profits with investors.
- It is treated as a separate legal entity.
- It is owned by one person who takes all the risk. (correct)
How do stockholders benefit from a corporation?
How do stockholders benefit from a corporation?
- They are personally liable for corporate debts.
- They can manage day-to-day operations.
- They receive fixed salaries regardless of profit.
- They earn money by selling stock or shares. (correct)
In what way is a corporation treated differently than a sole proprietorship?
In what way is a corporation treated differently than a sole proprietorship?
- A corporation cannot issue shares.
- A corporation can only be owned by a single individual.
- A corporation provides less risk to its owners.
- A corporation exists as a separate legal entity. (correct)
What is a potential disadvantage of a sole proprietorship compared to a corporation?
What is a potential disadvantage of a sole proprietorship compared to a corporation?
What distinguishes stockholders from sole proprietors in terms of profit distribution?
What distinguishes stockholders from sole proprietors in terms of profit distribution?
Flashcards
Sole Proprietorship
Sole Proprietorship
A business structure where one person owns and operates the company, taking all the risks and receiving all the profits.
Corporation
Corporation
A legal entity owned by stockholders who share in the profits or losses of the business.
Stockholders
Stockholders
The individuals who own a portion of a corporation, typically through stock or shares.
Stock or Shares
Stock or Shares
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Trading Stock
Trading Stock
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