Forms of Business Organization

Unlimited personal responsibility for all debts and for other liabilities that the business may incur is only possible in a sole proprietorship form of business.

Limited partners do not usually share in the managerial control of the business.

When one partner is served with a summons and complaint against the firm, all the partners are deemed to have received the notice, even if they are not informed.

The partnership and all partners are liable when any partner commits a tort while acting within the scope of the firm's business.

A corporation that files for bankruptcy must be dissolved.

Of the three principal forms, the simplest, most flexible, and easiest to start is the sole proprietorship.

The directors have a fiduciary duty to the corporation.

The biggest disadvantage of a corporation us the inability to transfer ownership rights in it.

A corporation cannot acquire and hold stock in other corporations.

The major advantage of the corporate form over the partnership form us in the way the corporate form is taxed.