Which of the Following Statements About S Corporations Is Most

question 337

Multiple Choice

Which of the following statements about S corporations is most accurate?

• A) The major attraction of S corporations is that they avoid the problem of double taxation.
• B) S Corporations are similar to C corporations, except that the majority of owners are foreign investors.
• C) Any corporation willing to pay the necessary fees and fill out the required paperwork can become an S Corporation.
• D) Only large corporations with operations in more than one state can qualify to be classified as S corporations.

---

Definitions:

Typeset

The arrangement and setting of textual material in a specific style and size of type for printing.

Zero Marginal Cost

The situation in which producing an additional unit of a good or service does not incur any additional cost.

Fixed Cost

Costs that do not change with the level of production or output, such as rent, salaries, and loan payments.

Patent

A legal right granted to an inventor that provides exclusive commercial rights to an invention or process for a certain period.