Oregon Construction Contractors (CCB) Practice Test

Which of the following is NOT a form of business entity available for structuring a business?

1. Sole Proprietorships

2. Partnerships

3. Corporations

4. Limited Liability Companies

The correct answer is: Corporations

The correct answer identifies a choice that does not fit within the context of business entity structures available for structuring a business. Corporations are, in fact, a legitimate and widely recognized business entity type characterized by offering limited liability protection to its owners, the ability to raise capital through stock issuance, and more durable governance structures. On the other hand, sole proprietorships, partnerships, and limited liability companies (LLCs) are all valid forms of business entities. Sole proprietorships are the simplest form of business, allowing individual ownership and operation. Partnerships involve two or more people who share ownership and responsibilities. Limited liability companies, or LLCs, combine characteristics of both corporations and partnerships, offering liability protection with operational flexibility. In the context of the question, the answer refers to an incorrect choice as being "not a form" of business entity, when in actuality, corporations are a recognized entity. This helps clarify the distinction between these different business structures and supports a comprehensive understanding of the options available for business organization.