Ch 2: Forms of ownership
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Questions and Answers

Which form of ownership does not have a legal personality?

  • Sole Proprietorship (correct)
  • Close Corporation
  • Public Company
  • Partnership

    • Which form of ownership requires a minimum of three directors?

  • Public Company (correct)
  • Private Company
  • Partnership
  • Close Corporation

    • Which form of ownership is solely managed by the owner?

  • Sole Proprietorship (correct)
  • Partnership
  • Private Company
  • Public Company

    • Which form of ownership requires a trading license and a partnership agreement?

    <p>Partnership</p> Signup and view all the answers

    Which form of ownership involves reserving a business name and registering the founding statement?

    <p>Close Corporation</p> Signup and view all the answers

    Which form of ownership does not exist beyond the owner’s participation?

    <p>Sole Proprietorship</p> Signup and view all the answers

    Which form of ownership requires issuing a prospectus and registering with regulatory bodies?

    <p>Public Company</p> Signup and view all the answers

    Which form of ownership is managed by directors, requiring at least one?

    <p>Private Company</p> Signup and view all the answers

    Which form of ownership is governed by a board of directors elected by members?

    <p>Co-operative</p> Signup and view all the answers

    What does the term 'Capital' refer to in the context of business ownership?

    <p>Financial assets or resources provided by owners to establish and operate their business</p> Signup and view all the answers

    Which type of business structure has the legal personality separate from its owners?

    <p>Corporations</p> Signup and view all the answers

    What does 'Continuity' refer to in the business context?

    <p>The capacity of a business to continue operations despite owner changes</p> Signup and view all the answers

    In terms of liability, what does 'Limited Liability' mean?

    <p>Owners are only responsible for the amount they have invested in the business</p> Signup and view all the answers

    How are sole proprietors and partnerships taxed?

    <p>Based on personal income rates</p> Signup and view all the answers

    'Formation Procedure' refers to:

    <p>Legal steps required to form a business</p> Signup and view all the answers

    'Unlimited Liability' means that:

    <p>Owners are personally responsible for all debts</p> Signup and view all the answers

    'Legal Personality' refers to which characteristic of a company?

    <p>Capacity to have legal identity separate from owners</p> Signup and view all the answers

    'Tax' in the context of business ownership depends on:

    <p>'s legal structure</p> Signup and view all the answers

    What does 'Liability' refer to in the context of business ownership?

    <p>Owner's responsibility for business debts</p> Signup and view all the answers

    What does 'Liability' refer to in the context of business ownership?

    <p>The responsibility for business debts based on the legal structure of ownership</p> Signup and view all the answers

    What does 'Formation Procedure' refer to?

    <p>The legal steps required for a business to be officially formed and begin operations</p> Signup and view all the answers

    In terms of taxation, what distinguishes how sole proprietors and partnerships are taxed from corporations?

    <p>Corporations pay a flat corporate tax rate while sole proprietors are taxed based on personal income rates</p> Signup and view all the answers

    What characteristic allows companies and close corporations (CCs) to enter contracts independently of their owners?

    <p>Legal Personality</p> Signup and view all the answers

    Which form of ownership offers owners protection by limiting their responsibility for business debts?

    <p>Corporation</p> Signup and view all the answers

    'Capital' in business ownership refers to:

    <p>The financial assets or resources that owners provide to establish and operate their business</p> Signup and view all the answers

    'Continuity' in the context of business ownership refers to:

    <p>The capacity of a business to continue operations despite changes in ownership</p> Signup and view all the answers

    'Tax' in business ownership depends on:

    <p>The legal structure of the business</p> Signup and view all the answers

    Which form of ownership allows for the existence of a business independently of the owners' status?

    <p>Close Corporation (CC)</p> Signup and view all the answers

    Which form of ownership requires at least one director for its management?

    <p>Private Company (Pty Ltd)</p> Signup and view all the answers

    Which form of ownership must have a minimum number of members depending on the type of cooperative?

    <p>Co-operative</p> Signup and view all the answers

    Which form of ownership involves the issuance of a prospectus and registration with regulatory bodies?

    <p>Public Company (Ltd)</p> Signup and view all the answers

    Which form of ownership does not depend on the involvement of any particular shareholder for its continuity?

    <p>Public Company (Ltd)</p> Signup and view all the answers

    Which form of ownership is managed by a board of directors elected by members?

    <p>Co-operative</p> Signup and view all the answers

    Which form of ownership has limited liability for members and a separate legal personality?

    <p>Close Corporation (CC)</p> Signup and view all the answers

    Which form of ownership does not exist beyond the owner’s participation?

    <p>Sole Proprietorship</p> Signup and view all the answers

    Which form of ownership requires a partnership agreement and a trading license for its formation?

    <p>Partnership</p> Signup and view all the answers

    Which form of ownership is managed solely by the owner?

    <p>Sole Proprietorship</p> Signup and view all the answers

    Which form of ownership offers limited liability to shareholders and can have an unlimited number of shareholders?

    <p>Public Company (Ltd)</p> Signup and view all the answers

    In which form of ownership are partners individually and collectively responsible for the entire debt and actions of co-owners?

    <p>Partnership</p> Signup and view all the answers

    Which form of ownership is the most regulated and requires a minimum of three directors for management?

    <p>Public Company (Ltd)</p> Signup and view all the answers

    Which form of ownership is more structured than sole proprietorships and partnerships and involves reserving a business name?

    <p>Private Company (Pty Ltd)</p> Signup and view all the answers

    Which form of ownership has continuity that is independent of the members’ status and is managed by appointed managers?

    <p>Close Corporation (CC)</p> Signup and view all the answers

    In which form of ownership does the continuity not depend on any particular shareholder but requires a minimum number of members?

    <p>Co-operative</p> Signup and view all the answers

    Which form of ownership involves issuing a prospectus and registering with regulatory bodies for its formation?

    <p>Public Company (Ltd)</p> Signup and view all the answers

    What form of ownership has unlimited joint and several liabilities among partners?

    <p>Partnership</p> Signup and view all the answers

    Which form of ownership is mainly recognized by a trading license as its establishment requirement?

    <p>Sole Proprietorship</p> Signup and view all the answers

    In which form of ownership are members governed by a board of directors elected by the members themselves?

    <p>Co-operative</p> Signup and view all the answers

    Which form of ownership has legal personality, limited liability for members, and a taxation rate that is not based on personal income rates?

    <p>Corporation</p> Signup and view all the answers

    Which form of ownership has legal personality, limited liability for members, and requires a trading license and a partnership agreement for its formation?

    <p>Partnership</p> Signup and view all the answers

    Which form of ownership has legal personality, continuity, and limited liability for members, but is taxed based on personal income rates?

    <p>Close corporation</p> Signup and view all the answers

    Which form of ownership has unlimited liability for members, continuity, and requires reserving a business name and registering the founding statement for its formation?

    <p>Cooperative</p> Signup and view all the answers

    Which form of ownership lacks legal personality, has unlimited liability for members, and requires issuing a prospectus and registration with regulatory bodies for its formation?

    <p>Partnership</p> Signup and view all the answers

    Which form of ownership lacks legal personality, has unlimited liability for members, and is solely managed by the owner?

    <p>Sole proprietorship</p> Signup and view all the answers

    Which form of ownership has legal personality, limited liability for members, and must have a minimum number of members depending on the type of cooperative?

    <p>Cooperative</p> Signup and view all the answers

    Which form of ownership lacks legal personality, has unlimited liability for members, and is managed by a board of directors elected by members?

    <p>Cooperative</p> Signup and view all the answers

    Which form of ownership has legal personality, limited liability for members, and requires a minimum of three directors?

    <p>Close corporation</p> Signup and view all the answers

    Which form of ownership lacks legal personality, has continuity, and involves the issuance of a prospectus and registration with regulatory bodies?

    <p>Corporation</p> Signup and view all the answers

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