NASCLA CONTRACTORS GUIDE
ARKANSAS. EXAM QUESTIONS WITH
100% CORRECT ANSWERS | LATEST
VERSION 2025/2026.
Poor _________ and inadequate ____________ are overriding factors in business failure -
ANS Planning; Management
entrepreneur - ANS A person engaged in strategic activities that involve the initiation and
development of a new business, created to build long term value and steady cash flow
Calculated risk - ANS a risk that is well - thought through where all outcomes are considered
rewards of owning your own business - ANS - being your own boss
-having flexibility of time
-having more freedom and independence
-making your own decisions
-receiving personal satisfaction from completing a job
A business plan should be a _________ ____________ that changes as your business and the
market change - ANS living document
1 | Page @COPYRIGHT 2025/2026 ALLRIGHTS RESERVED
,Business plan key functions - ANS 1. Planning tool
2. Loan or investor document
3. Benchmark tool
Elements of a business plan - ANS 1. cover page
2. Executive summary
3. Company summary
4. Products and Services
5. Market analysis
6. Market strategy
7. Financial plan
Business Plan Pitfalls - ANS - make sure your assumptions are realistic
- keep the language simple
- cover the risk as well as the opportunities
- analyze your competition thoroughly
Sole Proprietorship - ANS this business structure offers easy formation and operation,
however, unlimited personal liability is a concern because the business and owner are
considered the same legal entity
Advantages of a Sole Proprietorship - ANS - Minimal legal restrictions
- simple ownership form
- low startup cost
- sole ownership profits
- freedom in decision making process
2 | Page @COPYRIGHT 2025/2026 ALLRIGHTS RESERVED
, Disadvantages of Sole Proprietorship - ANS - unlimited personal liability
- less available capital
- possible difficulty obtaining long-term financing
-dissolution of the business in the event of the owners death
Partnership - ANS can bring together two or more people with strengths and resources in
different areas but also allow for unlimited personal liability of general partners. to reduce
conflicts among partners, responsibilities and business goals must be clearly outlined at the
beginning of the business arrangement
Advantages of a general partnership - ANS -ease of formation
-direct profit rewards
-larger management base than that of a sole proprietorship
General partnership - ANS can be formed through an oral agreement, but it is recommended
that a written partnership agreement be made
limited partnership - ANS A partnership with one or more general partners and one or more
limited partners.
disadvantages of a General Partnership - ANS - Unlimited personal liability of general
partners
- multiple decision makers
- limited life of the business
- Changes of partners or partnership agreement may be difficult
- partnership dissolves in the event of the death of a general partner
Partnership, Limited liability partnerships, and Limited liability partnerships must register
through the..... - ANS Arkansas secretary of state
3 | Page @COPYRIGHT 2025/2026 ALLRIGHTS RESERVED
ARKANSAS. EXAM QUESTIONS WITH
100% CORRECT ANSWERS | LATEST
VERSION 2025/2026.
Poor _________ and inadequate ____________ are overriding factors in business failure -
ANS Planning; Management
entrepreneur - ANS A person engaged in strategic activities that involve the initiation and
development of a new business, created to build long term value and steady cash flow
Calculated risk - ANS a risk that is well - thought through where all outcomes are considered
rewards of owning your own business - ANS - being your own boss
-having flexibility of time
-having more freedom and independence
-making your own decisions
-receiving personal satisfaction from completing a job
A business plan should be a _________ ____________ that changes as your business and the
market change - ANS living document
1 | Page @COPYRIGHT 2025/2026 ALLRIGHTS RESERVED
,Business plan key functions - ANS 1. Planning tool
2. Loan or investor document
3. Benchmark tool
Elements of a business plan - ANS 1. cover page
2. Executive summary
3. Company summary
4. Products and Services
5. Market analysis
6. Market strategy
7. Financial plan
Business Plan Pitfalls - ANS - make sure your assumptions are realistic
- keep the language simple
- cover the risk as well as the opportunities
- analyze your competition thoroughly
Sole Proprietorship - ANS this business structure offers easy formation and operation,
however, unlimited personal liability is a concern because the business and owner are
considered the same legal entity
Advantages of a Sole Proprietorship - ANS - Minimal legal restrictions
- simple ownership form
- low startup cost
- sole ownership profits
- freedom in decision making process
2 | Page @COPYRIGHT 2025/2026 ALLRIGHTS RESERVED
, Disadvantages of Sole Proprietorship - ANS - unlimited personal liability
- less available capital
- possible difficulty obtaining long-term financing
-dissolution of the business in the event of the owners death
Partnership - ANS can bring together two or more people with strengths and resources in
different areas but also allow for unlimited personal liability of general partners. to reduce
conflicts among partners, responsibilities and business goals must be clearly outlined at the
beginning of the business arrangement
Advantages of a general partnership - ANS -ease of formation
-direct profit rewards
-larger management base than that of a sole proprietorship
General partnership - ANS can be formed through an oral agreement, but it is recommended
that a written partnership agreement be made
limited partnership - ANS A partnership with one or more general partners and one or more
limited partners.
disadvantages of a General Partnership - ANS - Unlimited personal liability of general
partners
- multiple decision makers
- limited life of the business
- Changes of partners or partnership agreement may be difficult
- partnership dissolves in the event of the death of a general partner
Partnership, Limited liability partnerships, and Limited liability partnerships must register
through the..... - ANS Arkansas secretary of state
3 | Page @COPYRIGHT 2025/2026 ALLRIGHTS RESERVED
