4. Forms of business organizationsBusinesses can be classified into the following forms: sole proprietorship, partnership, corporation, limited liability company (LLC), and limited liabilitypartnership (LLP).Different forms of businesses have different characteristics. Which of the following characteristics would apply to a partnership? Check all that apply.O Subject to unlimited personal liabilityO Taxed at individual levelO Chartered by a state and is its own legal entity separate and distinct from its owners and managersO Income is allocated on a pro rata basisO Legal arrangement between two or more peopleO Can easily raise large amounts of capitalYou come across different kinds of businesses every day. The following table describes some businesses. Using the description of each business,classify it as a sole proprietorship, a partnership, a corporation, or a limited liability company/limited liability partnership.Business ScenarioType of BusinessAndrew founded and operated a wedding planning agency, which specialized in celebrityweddings. When he died, his business was dissolved because there was no plan for controlLLC/LLPafter his death.Purple Consulting has five consultants in the firm. The company's annual revenue isSole Proprietorshiparound $500,000. Income is distributed among all consultants, and each is personallyCorporationliable for claims if the company goes under.DDX Co. is a shipping company. Caesar owned 1,000 shares of DDX stock. He foundPartnershipbetter opportunities and sold his entire stake in DDX to another investor.Caesar, Rafael, and Jose own an accounting firm in San Francisco. All share in the profitsof the firm proportionately and file taxes at an individual level. According to theiragreement, none of the owners will be held personally liable for the accounting firm'sdebt.

Solution Concept Partnership business is a form of business which is carried out by two or more…

4. Forms of business organizations Businesses can be classified into the following forms: sole proprietorship, partnership, corporation, limited liability company (LLC), and limited liability partnership (LLP). Different forms of businesses have different characteristics. Which of the following characteristics would apply to a partnership? Check all that apply. Subject to unlimited personal liability O Taxed at individual level O Chartered by a state and is its own legal entity separate and distinct from its owners and managers O Income is allocated on a pro rata basis O Legal arrangement between two or more people O Can easily raise large amounts of capital You come across different kinds of businesses every day. The following table describes some businesses. Using the description of each business, classify it as a sole proprietorship, a partnership, a corporation, or a limited liability company/limited liability partnership.

4. Forms of business organizations Businesses can be classified into the following forms: sole proprietorship, partnership, corporation, limited liability company (LLC), and limited liability partnership (LLP). Different forms of businesses have different characteristics. Which of the following characteristics would apply to a partnership? Check all that apply. Subject to unlimited personal liability O Taxed at individual level O Chartered by a state and is its own legal entity separate and distinct from its owners and managers O Income is allocated on a pro rata basis O Legal arrangement between two or more people O Can easily raise large amounts of capital You come across different kinds of businesses every day. The following table describes some businesses. Using the description of each business, classify it as a sole proprietorship, a partnership, a corporation, or a limited liability company/limited liability partnership.

Income Tax Fundamentals 2020

38th Edition

ISBN:9780357391129

Author:WHITTENBURG

Publisher:WHITTENBURG

Chapter10: Partnership Taxation

Section: Chapter Questions

Problem 23MCQ

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