Explain Why Double Taxation Is Considered a Disadvantage of a Corporate

question 165

Essay

Explain why double taxation is considered a disadvantage of a corporate form of organization. Explain how double taxation occurs.

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Definitions:

Sales

The revenue a company earns from selling goods or services in its normal operations.

Operating Expenses

Costs associated with running a business's core operations on a daily basis, excluding costs of goods sold.

Merchandising Companies

Companies that purchase goods in a finished condition and sell them without further processing, making profit through the buying and selling of merchandise.

Service Companies

Businesses that provide intangible products or services to customers, as opposed to selling physical goods.