To Cover the Costs That Result If Some Aspect of the Business

question 14

Multiple Choice

To cover the costs that result if some aspect of the business causes harm to a third party or someone else's property,a firm would purchase:

• A)business interruption insurance.
• B)property insurance.
• C)business liability insurance.
• D)key personnel insurance.

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Definitions:

Tax Purposes

The specific reasons or objectives for which tax-related decisions are made, including the filing of returns, claiming deductions, and planning strategies to minimize tax liabilities.

C Corporation

A corporate structure where the owners or shareholders are taxed separately from the entity, which itself is taxed on its earnings.

S Corporation

A type of corporation that meets specific Internal Revenue Code requirements, allowing profits, and some losses, to be passed directly to owners' personal income without being subject to corporate tax rates.

Legal Entity

An organization or structure with legal rights and obligations, including the capacity to enter into contracts, sue, and be sued.