After a successful five years, Peaceful Pastures, LLC (a retirement ranch for race horses), thinks it may be able to attract donations from animal activist groups and even the federal government if it becomes a nonprofit corporation. As its business advisor, you explain that as a nonprofit corporation, the owner(s) may earn a salary but the business should not seek after-tax profits.

Question

Quizplus · Accepted Answer

Nonprofit corporations are allowed to pay salaries to their employees, including the owner(s), but their primary purpose should not be generating profits for the owners, shareholders, or investors. Nonprofits rely on donations, grants, and other forms of funding to support their mission and activities.

After a Successful Five Years, Peaceful Pastures, LLC (A Retirement