Which of the following statements is CORRECT? a. There is a tax disadvantage to

Question

Which of the following statements is CORRECT?

a. There is a tax disadvantage to incorporation, and there is no way any corporation can escape this disadvantage, even if it is very small.
b. Corporate shareholders are exposed to unlimited liability.
c. It is usually easier to transfer ownership in a corporation than in a partnership.
d. Corporate shareholders are exposed to unlimited liability, but this factor is offset by the tax advantages of incorporation.
e. Corporations generally face fewer regulations than sole proprietorships.

Explanation / Answer

Both Statements are correct

C. It is usually easier to transfer ownership in a corporation than it is to transfer ownership in a sole proprietorship

e. There is a tax disadvantage to incorporation, and there is no way any corporation can escape this disadvantage, even if it is very small.

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Reference:

http://quizlet.com/17282820/finance-chapter-1-5-7-10-flash-cards/

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