Tara Brtek owns and operates the Singing Pig Food Company. Brtek makes and markets 20 different gourmet mustards, salsas, marinades, and dip mixes using her crooning pig logo. Brtek has been thinking about changing her sole proprietorship to a corporation so she can take advantage of which of the following?
A) an enhanced ability to attract financing
B) fewer government restrictions and regulations
C) lower and fewer taxes
D) guaranteed loans for expansion

Question

Quizplus · Accepted Answer

By changing from a sole proprietorship to a corporation, Tara Brtek can enhance her ability to attract financing. Corporations have a separate legal entity from their owners, which means they can own assets and incur liabilities in their own name. This can make it easier for them to obtain financing through loans or investments, as they can offer collateral and legal protections to lenders and investors. However, corporations also have more regulations and taxes than sole proprietorships, which can outweigh the benefits of increased financing. The option of guaranteed loans for expansion is not a benefit that comes with changing from a sole proprietorship to a corporation.

Tara Brtek Owns and Operates the Singing Pig Food Company