All of the Following Is an Advantage of a Sole

question 63

Multiple Choice

All of the following is an advantage of a sole proprietorship except:

• A) creating one is easy and inexpensive
• B) limited liability
• C) it is not subject to double taxation
• D) the owner maintains complete control of the business
• E) business losses can be deducted against the sole proprietor's other sources of income

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Definitions:

Tax Incidence

The ultimate distribution of a tax burden.

Distribution

The process of making a product or service available for use or consumption by a consumer or business user.

Tax Shifting

Occurs when households can alter their behavior and do something to avoid paying a tax.

Avoid Paying

Strategies or actions taken to minimize or evade expenses, taxes, or other financial obligations.