Which of the Following Is Not One of the Things

question 85

Multiple Choice

Which of the following is not one of the things that causes a corporation to have a significant advantage over a partnership or a proprietorship?

• A) Limited liability.
• B) Ease of transfer of ownership interest.
• C) Unlimited life.
• D) Elimination of double taxation.
• E) Ability to retain earnings and thus convert income from personal income to capital gains.

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Definitions:

Statement of Owner's Equity

A financial document reflecting changes in the equity of a company's owners over a certain period, including capital contributions, withdrawals, and the net income or loss.

Balance Sheet

A summary of a corporation's assets, liabilities, and equity held by shareholders, documented at a particular moment.

Periodic Inventory System

An accounting method where the inventory level is updated in the accounting records at specific intervals, rather than after each sale or purchase.

Perpetual Inventory System

An inventory management method where stock levels are updated in real-time with each sale or purchase.