Identify a true statement about a limited liability company (LLC).
A)A limited liability company can be taxed as a corporation only.
B)One of the owners of a limited liability company must be designated as a general partner with unlimited personal financial liability.
C)A limited liability company can have no more than 100 stockholders.
D)Only one of the owners of a limited liability company can participate in the management of the business.
E)A limited liability company can have more than one type of stock (ownership interest) outstanding.

Question

Identify a true statement about a limited liability company (LLC). 
A)A limited liability company can be taxed as a corporation only.
B)One of the owners of a limited liability company must be designated as a general partner with unlimited personal financial liability.
C)A limited liability company can have no more than 100 stockholders.
D)Only one of the owners of a limited liability company can participate in the management of the business.
E)A limited liability company can have more than one type of stock (ownership interest) outstanding.

Quizplus · Accepted Answer

A limited liability company can have more than one type of stock (ownership interest) outstanding. This allows for flexibility in the ownership structure, as different types of ownership interests can have different rights and benefits. The other options are false statements. A limited liability company can be taxed as a partnership or a sole proprietorship, not just as a corporation (A), there is no requirement for a general partner with unlimited personal financial liability (B), there is no limit on the number of owners (C), and multiple owners can participate in the management of the business (D).

Identify a True Statement About a Limited Liability Company (LLC)