Which of the Following Statements About Limited Liability Is Correct

question 38

Multiple Choice

Which of the following statements about limited liability is correct?

• A) It is only provided to the owners of certain businesses.
• B) Creditors cannot attach a claim to the personal assets of the owners of a limited liability company.
• C) There are now more organizational forms of business with limited liability characteristics than in the past.
• D) All of the above are correct.

---

Definitions:

Leverage

The use of borrowed funds to increase the potential return of an investment.

Solvency

A measure of a company's ability to meet its long-term financial obligations, reflecting its financial stability and health.

Profitability Analysis

Evaluation of a company's ability to generate profits from its operations, typically assessed through various financial metrics and ratios.

Profitability Analysis

An assessment process to determine the ability of a business to generate earnings as compared to its expenses and other relevant costs incurred during a specific period.