1) A sole proprietorship is owned by:
A) one person
B) two or more people
C) shareholders
D) bankers
Answer: A
Diff: 1 Type: MC
Topic: 1.1 The Three Types of Firms
2) In Canada, which of the following organization forms accounts for the greatest number of
firms?
A) Limited Liability Partnership
B) Limited Partnership
C) Sole Proprietorship
D) Publicly Traded Corporation
Answer: C
Diff: 1 Type: MC
Topic: 1.1 The Three Types of Firms
3) Which of the following organization forms earns the most revenue?
A) Privately Owned Corporation
B) Limited Partnership
C) Publicly Owned Corporation
D) Limited Liability Company
Answer: C
Diff: 1 Type: MC
Topic: 1.1 The Three Types of Firms
4) Which of the following is NOT an advantage of a sole proprietorship?
A) Single taxation
B) Ease of setup
C) Limited liability
D) No separation of ownership and control
Answer: C
Diff: 2 Type: MC
Topic: 1.1 The Three Types of Firms
6) Whic h of the f ollowing is/are an advantage(s) of incorporation?
A) Access to capital markets
B) Limited liability
C) Unlimited life
D) All of the above
Answer: D
Diff: 2 Type: MC
Topic: 1.1 The Three Types of Firms
7) In Canada, a limited liability par tnership, LLP, is essentially:
A) a limited partnership without limited partners
B) a limited partnership without a general partner
C) just another name for a limited partnership
D) just another name for a corporation
Answ er: B
Diff: 1 Type: MC
Topic: 1.1 The Three Types of Firms
8) In Canada, which of the following business organization forms cannot avoid double taxation?
A) Limited Partnership
B) Publicly Traded Corporation
C) Privately Owned Corporation
D) Limited Li ability Company
Answer: B
Diff: 1 Type: MC
Topic: 1.1 The Three Types of Firms
9) In Canada, the dividend tax credit gives some relief by:
A) effectively giving a lower tax rate on dividend income than on other sources of income
B) effectively giving a higher tax rate on divide nd income than on other sources of income
C) effectively giving the same tax rate on dividend income as on other sources of income
D) effectively giving a tax rate of zero on dividend income compared to other sources of income
Answer: A
Diff: 1 Type: MC
Topic: 1.1 The Three Types of Firms
11) In Canada, the d istinguishing feature of a corporation is that:
A) there is no legal difference between the corporation a nd its owners
B) it is a legally defined, artificial being, separate from its owners
C) it spreads liability for its corporate obligations to all share holders
D) it provides limited liability only to small shareholders
Answer: B
Diff: 2 Type: MC
Topic: 1 .1 The Three Types of Firms
12) Which of the following is/are subject to double taxation in Canada?
A) Corporation
B) Partnership
C) Sole proprie torship
D) Both A and B
Answer: A
Diff: 1 Type: MC
Topic: 1.1 The Three Types of Firms
13) Canada Revenue Agency, CRA, allows an exemption from double taxation for certain flow
through entities where all income produced by the business flows to the investors and virtually
no earnings are retained within the business. These entities are called:
A) Canadian Fed eral Crown Corporations
B) Canadian Controlled Corporations
C) Income Trust Corporations
D) Foreign Controlled Corporations
Answer: C
Diff: 1 Type: MC
Topic: 1.1 The Three Types of Firms
Powered by TCPDF (www.tcpdf.org)
4 / 4
The benefits of buying summaries with Stuvia:
Guaranteed quality through customer reviews
Stuvia customers have reviewed more than 700,000 summaries. This how you know that you are buying the best documents.
Quick and easy check-out
You can quickly pay through credit card or Stuvia-credit for the summaries. There is no membership needed.
Focus on what matters
Your fellow students write the study notes themselves, which is why the documents are always reliable and up-to-date. This ensures you quickly get to the core!
Frequently asked questions
What do I get when I buy this document?
You get a PDF, available immediately after your purchase. The purchased document is accessible anytime, anywhere and indefinitely through your profile.
Satisfaction guarantee: how does it work?
Our satisfaction guarantee ensures that you always find a study document that suits you well. You fill out a form, and our customer service team takes care of the rest.
Who am I buying these notes from?
Stuvia is a marketplace, so you are not buying this document from us, but from seller Succeed. Stuvia facilitates payment to the seller.
Will I be stuck with a subscription?
No, you only buy these notes for $22.49. You're not tied to anything after your purchase.