Sole Proprietorships
THow many people own and operate a sole proprietorship?
One person
What is the minimum number of people required to form a partnership?
Two or more people.
A corporation is a legal entity that exists only on paper and has most rights of a real ____.
Person
Which structure combines partnership tax benefits with corporate limited liability?
LLC (Limited Liability Company)
According to SBA standards, manufacturing businesses are small if they have how many or fewer employees?
500 employees or less
What portion of business risks does a sole proprietor accept?
ALL the risks
Which type of partner is involved in day-to-day operations and has unlimited liability?
General Partner
Who are the true legal owners of a corporation?
Stockholders / Shareholders
What type of corporation provides social or educational services instead of seeking profit for personal gain?
Nonprofit Organization
Small businesses employ roughly what percentage of all private sector employees in the U.S.?
About half (50%)
Name ONE advantage of starting a sole proprietorship over a corporation.
Easy/inexpensive to start, keep all profits, full decision control, or lower taxes
Which type of partner invests money but is NOT involved in daily operations and has limited liability?
Limited Partner
What term describes the tax disadvantage where corporate profits and dividends are both taxed?
Double Taxation
In a franchise setup, what is the "parent" company that grants the business license called?
Franchisor
What is the primary reason given for small business failure?
Lack of business knowledge (mismanagement)
What type of liability means a owner's personal assets can be taken to pay business debts?
Unlimited liability
What is the written legal contract that explains the terms, investments, and rules of a partnership called?
Articles of Partnership / Partnership Agreement
According to corporate structure, who appoints or elects the Board
The Stockholders
What is the individual or company purchasing the franchise license called?
Franchisee
Small businesses generated approximately what percentage of net new jobs over the last 25 years?
63%
Sole proprietorships generate over 80% of total U.S. sales
False
Procter & Gamble formed a partnership in 1837 to compete with 14 other makers of which TWO products in Cincinnati?
Soap and Candles
Rank these corporate roles from top to bottom in authority: Officers, Stockholders, Employees, Board of Directors.
Stockholders → Board of Directors → Officers → Employees
Name TWO advantages an LLC enjoys over a traditional C-Corporation
No double taxation, limited liability, & not required to publish annual reports
Approximately what percentage of small businesses in the United States are home-based?
52%