FUNERAL HOME MANAGEMENT MIDTERM STUDY GUIDE (FSE
2202) EXAM QUESTIONS AND ANSWERS WITH COMPLETE
SOLUTIONS VERIFIED
A written document that states explicitly the rights and duties of partners in a
partnership
Articles of Partnership
Define a sole proprietorship
An individual conducting a business as an individual and sole owner
Advantages of a partnership
-Combined management, talent, capital
-Easy to form
-Efficiency of labor
-Possibility of employees to buy into the business
-Each partner contributes goodwill in the business
Disadvantages of a Partnership
-Lack of continuity
-Decisions are binding on both parties
-Frozen investments
-Collateral is used for business debt
-Unlimited liability of general partners
,-Possibility of unsatisfactory division of profits
-Possibility of managerial difficulties
List the advantages of a sole proprietorship
-Ease of starting
-Low cost of organization
-Profits go to the single owner
-Promptness of action
-Secrecy on business dealings
-Customer recognition
-Unique credit standing
List the disadvantages of a sole proprietorship
-Unlimited financial risk
-Limited size
-Limited life
-Limited management ability
-Limited opportunities for employees
-Difficulty in raising capital
A legal form of organization whereby a legal entity is authorized by a state to
operate
Corporation
The written application for permission to incorporate that is approved by a state
official
Corporation Charter
, A form of legal organization in which a business association made up of two or
more persons is formed for the purposes of carrying on as co-owners
Partnership
A partner in a partnership who is not active in its management and has limited
personal liability
Limited partner
A business organization that is recognized by the law as having a separate legal
existence
Corporation
A partner in a limited partnership who has unlimited personal liability. (personally
liable for the debts of the business)
General Partner
A document specifying the number of shares owned by a stockholder
Stock certificate
List the advantages of a corporation
-Continuity in existence
-Ease of ownership
-Limited Liability
-Large financial capability
-Specialized management
-Legal entity
List the disadvantages of a corporation
2202) EXAM QUESTIONS AND ANSWERS WITH COMPLETE
SOLUTIONS VERIFIED
A written document that states explicitly the rights and duties of partners in a
partnership
Articles of Partnership
Define a sole proprietorship
An individual conducting a business as an individual and sole owner
Advantages of a partnership
-Combined management, talent, capital
-Easy to form
-Efficiency of labor
-Possibility of employees to buy into the business
-Each partner contributes goodwill in the business
Disadvantages of a Partnership
-Lack of continuity
-Decisions are binding on both parties
-Frozen investments
-Collateral is used for business debt
-Unlimited liability of general partners
,-Possibility of unsatisfactory division of profits
-Possibility of managerial difficulties
List the advantages of a sole proprietorship
-Ease of starting
-Low cost of organization
-Profits go to the single owner
-Promptness of action
-Secrecy on business dealings
-Customer recognition
-Unique credit standing
List the disadvantages of a sole proprietorship
-Unlimited financial risk
-Limited size
-Limited life
-Limited management ability
-Limited opportunities for employees
-Difficulty in raising capital
A legal form of organization whereby a legal entity is authorized by a state to
operate
Corporation
The written application for permission to incorporate that is approved by a state
official
Corporation Charter
, A form of legal organization in which a business association made up of two or
more persons is formed for the purposes of carrying on as co-owners
Partnership
A partner in a partnership who is not active in its management and has limited
personal liability
Limited partner
A business organization that is recognized by the law as having a separate legal
existence
Corporation
A partner in a limited partnership who has unlimited personal liability. (personally
liable for the debts of the business)
General Partner
A document specifying the number of shares owned by a stockholder
Stock certificate
List the advantages of a corporation
-Continuity in existence
-Ease of ownership
-Limited Liability
-Large financial capability
-Specialized management
-Legal entity
List the disadvantages of a corporation
