Identify a Benefit of Holding Larger Inventories

question 3

Multiple Choice

Identify a benefit of holding larger inventories.

• A)Less holding costs
• B)Less risk
• C)Abundance of funds
• D)Smoother production schedules

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Definitions:

S-corp

is a type of corporation that meets specific Internal Revenue Code requirements, allowing it to pass income directly to shareholders and avoid double taxation.

C-corp

A type of corporation subject to corporate income tax, distinct from its owners, who are taxed separately on their personal income from the corporation.

Double Taxation

A situation where income or profits are taxed at two levels, typically once at the corporate level and again at the individual shareholder level.

Dividends

Payments made by a corporation to its shareholders from the company's profits or reserves.