Flashcards Business Structures and Types Review

Front

What is a sole proprietorship?

Back

A business owned by one person.

Front

What is an example of a sole proprietorship?

Back

A baker who runs their own shop.

Front

What is an advantage of a sole proprietorship?

Back

Easy to form with fewer legal requirements.

Front

What is a disadvantage of a sole proprietorship?

Back

Unlimited personal liability for debts.

Front

What does "unlimited personal liability" mean for a sole proprietor?

Back

The owner's personal assets can be used to pay business debts.

Front

What is a partnership?

Back

A business where two or more people share ownership.

Front

What is an advantage of a partnership?

Back

Shared workload and responsibilities.

Front

What is a disadvantage of a partnership?

Back

Partners may disagree on important decisions.

Front

What does it mean when profits are shared in a partnership?

Back

All partners receive a portion of the profits.

Front

What is a corporation?

Back

A business owned by shareholders.