Five Accountants Have Formed an Organization Within Which They Will

question 18

Multiple Choice

Five accountants have formed an organization within which they will provide their services.What type of organization have they most likely chosen and why?

• A) They have formed a corporation in which members are liable for their own malpractice but not for the malpractice of other members.
• B) They have formed a partnership because members are not liable for their own malpractice or for the malpractice of other members because recovery for malpractice may only be obtained from assets of the partnership itself.
• C) They have formed a limited liability partnership because members are liable for their own malpractice but not for the malpractice of other members.
• D) They have formed a corporation because the tax structure is most beneficial to the five of them this way.

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Definitions:

Milgram Experiment

A psychological experiment conducted by Stanley Milgram in the 1960s to study obedience to authority, where participants were instructed to administer electric shocks to another person.

Stanford University Prison Experiment

A psychological study conducted by Philip Zimbardo in 1971 at Stanford University, where students were assigned roles of prisoners and guards to explore the effects of perceived power.

Generalization

Drawing a conclusion about a certain characteristic of a population based on a sample from it.

Logical Support

The provision of reasons or evidence to justify a claim or argument.