QUIZ 1: IDENTIFICATION

Instruction: Identify the type of business organization described by the statements provided below.

sole proprietorship1. This business is owned by only one individual.

________________________________________

Partnership2. This business is owned by two or more individuals who agree to contribute resources and
carry

out a business and divide among themselves the profits or losses therefrom. ______________

Service Business3. This type of business offers services, such as, professional skills, expertise, advice,
lending, and

similar services, as its main product, rather than physical goods. _______________________

Merchandising4. This business engages in the “buying” and “selling” of goods. Its earnings are primarily

derived from the markup it adds to the cost of the goods it sells to the customers.

____________________________________

Corporation5. This business is owned by at least five members who are called stockholders or
shareholders.

________________________________________

Manufacturing6. This business engages in buying raw materials and processing them into final

products.______________________________________

Cooperative7. This organization is owned by at least 15 individuals who are called members. The
distinguishing

characteristic of this organization is that its members need to patronize its products.

__________________________

Sole Proprietorship8. In this type of business organization, you are the only boss, and hence, you keep
all the profits

but assume all the risk of loss. _____________________________________

Corporation9. In this type of business organization, you may be an owner but not the boss. Indeed, your
“say”

in the business may be insignificant if you have insignificant shareholdings.

_________________

Partnership10. In this type of business organization, you are automatically one of the bosses, but not
the only
one. This type of business organization is relatively easier to form as compared to the other

business organizations that are owned by more than one individual. ____________________

QUIZ 2: TRUE OR FALSE

Instruction: Before each statement, write TRUE if the statement is correct or FALSE if the

statement is incorrect.

TRUE1. A sole proprietorship is registered with the Department of Trade and Industry (DTI)

rather than with the Securities and Exchange Commission (SEC).

TRUE2. A corporation is registered with the Cooperative Development Authority (CDA).

FALSE3. A partnership business is registered with the Department of Trade and Industry (DTI)

and the Securities and Exchange Commission (SEC).

FALSE4. A grocery store is most likely to be considered a service business.

TRUE5. Businesses that engage in more than one type of business activity, such as selling

goods and at the same time offering services, are referred to as hybrid businesses.

TRUE6. A school is most likely to be considered a manufacturing business – the raw

materials are the students and the finished products are responsible and competent

business professionals.

FALSE7. A car dealer, one who buys cars from car producers and sells them in their original

state and without further modifications, is most likely to be considered a trading

business rather than a manufacturing business.

TRUE8. A stockholder of a corporation is personally liable for the debts of the corporation.

TRUE9. A corporation is the easiest form of business organization to establish because there

are fewer legal requirements compared to the other forms of business organization.

FALSE10. You and your friend are members in a cooperative. You hold 1 share while your friend holds
10,000 shares. During members’ meetings, your friend can cast 10,000
votes while you can only cast 1 vote.

QUIZ 3: MULTIPLE CHOICE

1. Which of the following is most likely an advantage of a corporation over the other types of

business organizations?

a. Shared management responsibility over the owners

b. Ease of formation

c. Greater capital and, hence, better opportunity for growth

d. Limited life

2. It is a form of business organization that provides a greater degree of continuity

a. Cooperative

b. Sole proprietorship

c. Partnership

d. Corporation

3. It is a business organization that is owned by several individuals. It is formed by operation of law

and is registered with the SEC.

a. Cooperative

b. Sole proprietorship

c. Partnership

d. Corporation

4. The liability of a shareholder for corporate debts is limited to the value of his or her shareholdings

because a corporation

a. has a separate legal identity from its shareholders

b. provides liability insurance for its shareholders

c. issues stocks for additional funds

d. can issue dividends to the shareholders when the corporation earns enough profits
5. This type of business organization has the tendency to become monopolistic. It can hamper the

economy by funneling wealth to only few individuals (i.e., the organization’s top owners) and

restricting the redistribution of wealth to the majority of the members of the society.

a. Cooperative

b. Sole proprietorship

c. Partnership

d. Corporation