Allen Barron has invested $800,000 in a privately held family corporation. The corporation does not do well and must declare bankruptcy. What amount does Barron stand to lose?
A) up to his total investment of $800,000
B) zero
C) the $800,000 plus any personal assets the creditors demand
D) $400,000

Question

Quizplus · Accepted Answer

A shareholder in a corporation can lose up to the amount of their investment if the corporation goes bankrupt. They are not liable for the corporation's debts beyond their investment.

Allen Barron Has Invested $800,000 in a Privately Held Family