Robert Fischer Is One of the Owners of a fiRm

question 187

Multiple Choice

Robert Fischer is one of the owners of a firm which generated $18,000 in taxable income last year. Robert did not have to pay any personal tax on his share of the firm's income. Robert must be a
Partial owner of a:

• A) Sole proprietorship.
• B) General partnership.
• C) Limited partnership.
• D) Non-dividend paying corporation.
• E) Limited liability company.

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Definitions:

Cost Of Capital

The rate of return that a company must earn on its project investments to maintain its market value and attract investors.

Average Rate

Usually refers to the mean value of a set of rates or percentages over a specified period or set of conditions.

Salvage Value

The estimated resale value of an asset at the end of its useful life.

Internal Rate

Often refers to the internal rate of return (IRR), a metric used in capital budgeting to estimate the profitability of potential investments.