Tutoring Concerns

question 88

Multiple Choice

Tutoring Concerns.Wally and Sally want to go into business together and plan on offering a tutoring service to high school and college students.Wally proposes that they share control of the business and split profits equally and not bother with a written agreement.Sally,however,is concerned about being able to pay their debts because they will have to rent tutoring space and purchase computers and supplies.She is also concerned about parents and students who may sue if the students' test scores do not improve.She tells Wally that she just bought a new boat and car,and that she does not want her assets to be in jeopardy.She tells Wally that they should form a corporation to shield their personal assets.Wally,however,says their personal assets are not in danger with his proposal because they are a business and that,furthermore,forming a corporation would likely result in double taxation.What type of arrangement,if any,would avoid double taxation for the Wally and Sally's endeavor?

• A)An S corporation
• B)A limited liability company
• C)A corporation
• D)An S corporation,a limited liability company,or a corporation
• E)An S corporation or a limited liability company,but not a corporation

---

Definitions:

Alberta Tar Sands

Large deposits of bitumen, a very heavy oil, located in northeastern Alberta, Canada, considered one of the world's largest reserves of crude oil.

Industrial Pollution

The release of harmful contaminants into the environment as a result of manufacturing, processing, and other industrial activities, affecting air, water, and soil quality.

Northern Québec

A geographical region in Canada, characterized by its vast, sparsely populated territories and predominance of Indigenous cultures.

Sydney Steel Company

Was a steel production company located in Sydney, Nova Scotia, known for its historical significance in the region's industrial development.