Which of the Following Is Not One of the Four

question 61

Multiple Choice

Which of the following is not one of the four factors identified in the textbook as critical in selecting a form of business ownership?

• A) The cost of setting up and maintaining the legal form
• B) The number and types of investors involved
• C) Accounting considerations
• D) Tax considerations
• E) The extent to which personal assets can be shielded from the liabilities of the business

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Definitions:

Taxable Income

The amount of income that is used to calculate an individual's or a company's income tax due. It is the gross income minus deductions and exemptions allowed by the tax code.

Adjusted Gross Income (AGI)

The total gross income minus specific deductions defined by the IRS, used to determine taxable income.

Qualifying Relative

A term used in tax law to describe someone who doesn’t have to live with the taxpayer all year but must meet certain financial support and income criteria to be claimed as a dependent.

Gross Income Test

A requirement for determining if someone can be claimed as a dependent, based on their income level.