Which of the following is true about a corporation?

Question

Quizplus · Accepted Answer

A corporation is a legal entity that exists separately from its owners. This means that the corporation can enter into contracts, sue and be sued, and own property in its own name. The owners of the corporation are shareholders, who have limited liability for the debts and obligations of the corporation. Therefore, the correct answer is C. The other choices are incorrect. A is incorrect because a corporation does not combine the advantages of all other forms; it only provides limited liability for its owners. B is incorrect because a nonprofit organization can also be registered as a corporation. D is incorrect because for tax purposes, a corporation is taxed as a separate entity, not as a partnership. E is incorrect because for liability purposes, a corporation provides limited liability for its owners, not the unlimited liability of a partnership.

Which of the Following Is True About a Corporation