Question: In which form of business ownership do owners have limited liability?
Options:
Sole proprietorship
General partnership
Limited liability company
Joint venture
Correct Answer: Limited liability company
Solution:
A limited liability company (LLC) provides limited liability protection to its owners.
In which form of business ownership do owners have limited liability?
Practice Questions
Q1
In which form of business ownership do owners have limited liability?
Sole proprietorship
General partnership
Limited liability company
Joint venture
Questions & Step-by-Step Solutions
In which form of business ownership do owners have limited liability?
Step 1: Understand what limited liability means. It means that the owners are not personally responsible for the business's debts.
Step 2: Identify the types of business ownership. Common types include sole proprietorships, partnerships, corporations, and limited liability companies (LLCs).
Step 3: Recognize that in a sole proprietorship and partnership, owners can be personally liable for debts.
Step 4: Learn that in a corporation and a limited liability company (LLC), owners have limited liability.
Step 5: Conclude that a limited liability company (LLC) is the form of business ownership that provides limited liability protection to its owners.
Limited Liability – Limited liability means that the owners' personal assets are protected from the business's debts and liabilities.
Forms of Business Ownership – Different structures such as sole proprietorships, partnerships, corporations, and limited liability companies (LLCs) have varying levels of liability.
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