What Is One of the Disadvantages of a Corporation When

question 35

Multiple Choice

What is one of the disadvantages of a corporation when compared to a partnership?

• A)the shareholders have limited liability.
• B)the shareholders are treated as a separate legal entity from the corporation.
• C)the corporation and its shareholders are potentially subject to double taxation.
• D)the corporation provides continuity of life.

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Definitions:

Indirect Method

A technique in financial accounting to prepare the cash flow statement, whereby net income is adjusted for non-cash transactions and changes in working capital.

Sale Of Investments

The process of liquidating investments such as stocks, bonds, or real estate, often to generate cash.

Statement Of Cash Flows

A financial report summarizing the total cash inflows from a company's operational activities and outside investments, alongside the cash outflows for paying off its business operations and investments within a specific timeframe.

Schedule

A plan that lists events, tasks, or activities along with their intended times and dates.