U5 Review

Copy and paste the following questions into a Microsoft Word document. Answer each question with a minimum of two to three (2–3) sentences. Some prompts will require substantially more than that to fully respond. Be thorough when addressing each item and be sure to answer each part of the prompt. You should use only your textbook to support this activity. Please do not use an Internet search engine. Each question is worth 10 points.

1. When choosing a business form, what are they key differences between a proprietorship, a partnership and a corporation?
2. What are the seven characteristics of a partnership?
3. What are the differences between a/an
   1. Limited liability partnership
   2. Limited liability corporation
   3. S corporation?
4. What factors are taken into consideration when choosing a business form?
5. What are the three methods used to allocate income or loss? Explain each method.
6. What accounts are affected when recording the admission of a new partner when the new partner contributes cash?
7. What are the two ways a partner generally withdraws from a partnership?
8. What does capital deficiency mean? What happens if a partner cannot pay a deficiency?
9. When there is death of a partner, what happens to the partnership?
10. What are the steps taken when a partnership is liquidated?