A Limited Liability Company

question 17

Multiple Choice

A limited liability company:

• A) can only have a single owner.
• B) is comprised of limited partners only.
• C) is taxed similar to a partnership.
• D) is taxed similar to a C corporation.
• E) generates totally tax-free income.

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Definitions:

Consolidated Financial Statements

Financial statements that aggregate the financial position and operating results of a parent company and its subsidiaries, presenting the group as a single economic entity.

Common Shares

Equity securities that represent ownership interest in a corporation, giving holders voting rights and a share in the company's profits via dividends.

Net Income

The total profit of a company after all expenses and taxes have been deducted from revenues, often referred to as the bottom line.

Dividends

Distributions of a company's earnings given to its shareholders, typically originating from the company's profits.