Chapter 5 - Entrepreneurship

Most businesses do not require a federal license to operate, but some do

• True
• False

Examples of businesses that require federal licenses and/or permits to operate include businesses that sell (or provide)? Check 3 examples

• Alcohol
• Tobacco
• Firearms
• Pillow

In most states, there are three different categories of licenses and permits that you may need to operate a business. Which is it?

• Business Registration Requirements
• Sales Tax Permits
• Professional and Occupational Licenses and Permits
• Import Tax permit

Do hotel and motel require licences?

• YES
• NO

A corporation is taxed as a separate

legal entity.

• True

• False

All businesses, other than sole proprietorships that do not have employees, are required to obtain a Federal Employee Identification Number (also called an EIN)

• True
• False

A limited liability company pay a lot of taxes.

• True

• False

Which one is the definition of partnership?

• If two or more people start a business, they must organize as a partnership, corporation, or limited liability company
• a separate legal entity that, in the eyes of the law, is separate from its owners.
• a form of business organization involving one person, and the person and the business are essentially the same.

Which one is NOT the advantages of partnership?

• Moderate cost to set up
• Low cost to set up
• Not taxed twice
• Easy to get funds

What is the advantages of LLC?

• Limited liability (Capital)
• Shareholders are limited in number
• taxed only once
• all