SOMEBODY’S BUSINESS—ANSWER GUIDE

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Statements

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1. Can have a single owner X X X X

2. Can have unlimited liability X X*

3. Must have 100 or fewer shareholders X

4. Can have limited liability X** X X X X

5. Shares not offered to the public X X X

6. Designed to help small businesses

X
avoid dual taxation

7. Usually sells millions of shares

X
in stock

8. Generally not taxed by the federal

X
government

9. Involves paying royalty fees X X X

10. Operates under trade name of

X
parent company

11. Requires little start-up capital X

12. A short-term relationship X

13. An independent sales relationship X

14. Uses trademarked material for a

X
limited time

15. Pays commissions to two or

X
more people

16. Ideal arrangement for developing

X
new profit centers

17. Combines corporation with sole

X
proprietorship or partnership

* General partnership
** Limited partnership

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