Which of the following statements is CORRECT?
A) It is generally more expensive to form a proprietorship than a corporation because, with a proprietorship, extensive legal
Documents are required.
B) Corporations face fewer regulations than sole proprietorships.
C) One disadvantage of operating a business as a sole proprietorship is that the firm is subject to double taxation, at both the firm
Level and the owner level.
D) One advantage of forming a corporation is that equity investors are
Usually exposed to less liability than in a regular partnership.
E) If a regular partnership goes bankrupt, each partner is exposed to liabilities only up to the amount of his or her investment in the business.

Question

Quizplus · Accepted Answer

One advantage of forming a corporation is that equity investors are usually exposed to less liability than in a regular partnership. This is because the shareholders of a corporation are only liable for the amount of their investment in the company and are not personally responsible for the company's debts or legal liabilities.

Which of the Following Statements Is CORRECT