Which of the Following Is False Regarding Limited Liability Companies

question 49

Multiple Choice

Which of the following is false regarding limited liability companies?

• A) Members need not be citizens of the U.S.
• B) Limited liability companies have the limited liability of corporations yet may be taxed like partnerships.
• C) A limited liability company is formed by filing articles of organization in the state in which members want to establish their LLC.
• D) For purposes of jurisdiction, an LLC is considered a citizen of every state in which its members reside.
• E) Owners of an LLC are referred to as incorporators.

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Definitions:

Earnings Per Share

A measure of a company's profitability that calculates the portion of a company’s profit allocated to each outstanding share of common stock.

Earnings Per Share

A measure of a company's profitability calculated by dividing its net earnings by the number of outstanding shares.

Price-Earnings Ratio

A valuation ratio for a company calculated by dividing its current share price by its earnings per share, indicating the dollar amount an investor can expect to invest in a company in order to receive one dollar of that company's earnings.

Dividend Payout Ratio

A financial ratio that shows the proportion of earnings a company pays out to shareholders in the form of dividends.