Which of the Following Is True of a Limited Liability

question 51

Multiple Choice

Which of the following is true of a limited liability company?

• A)A limited liability company is not obliged to file the articles of organization with the state.
• B)The owners of a limited liability company are personally liable for the business's debts.
• C)A limited liability company can elect not to pay business income tax.
• D)The owners of a limited liability company cannot participate actively in management of the business.

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Definitions:

Debt-equity Ratio

A measure representing the balanced usage of debt and shareholders' equity in funding company assets.

Profit Margin

A financial metric indicating the percentage of revenue that exceeds the cost of goods sold, showcasing efficiency in managing expenses versus income.

Growth Determinant

Factors that contribute to the economic expansion of a country, region, or industry, impacting productivity and development.

Cash Coverage Ratio

Cash coverage ratio is a financial metric that measures a company’s ability to pay its debt obligations with its operating cash flow.