Traci and Sally have considered starting their own business but are concerned about the possibility of losing their personal assets if the business fails. One way for Traci and Sally to avoid this risk would be to organize their company as a ________.
A)general partnership
B)limited partnership
C)corporation
D)sole proprietorship

Question

Quizplus · Accepted Answer

A corporation is a separate legal entity and, as such, the personal assets of the owners are typically protected from the liabilities of the business. General partnerships and sole proprietorships, on the other hand, do not offer this level of protection, and the personal assets of the owners can be at risk. Limited partnerships provide some protection for limited partners but not for general partners.

Traci and Sally Have Considered Starting Their Own Business but Are