CE 521 Construction Business Management
Assignment- 4
Chapter 2 Review questions
1. What is the difference between a proprietorship and a partnership?
A proprietorship is a business held by a single person. Profits are taxed at the owner’s personal rate, and
the owner is personally liable for the company’s debts. A partnership is a group of two or more people
who get together to run a business as co-owners. In a general partnership, all partners share the profits
tax responsibility as well as the firm’s unlimited liability.
2. What is the difference between a general partnership and a limited partnership?
All partners in a general partnership share the profits tax responsibility and the firm’s unlimited liability.
In a limited partnership, all partners share in the profit tax responsibility, but only the general partners
have unlimited liability for the company. Limited partners are solely accountable for the amount of
money they put into the company.
3. What is the difference between a partnership and a corporation?
A partnership is a group of two or more people who get together to run a business as co-owners. In a
general partnership, all partners share the profits tax responsibility as well as the firm’s limitless liability.
