Which of the following statements is CORRECT?

Question

Quizplus · Accepted Answer

A sole proprietorship offers no protection to the owner's personal assets. Therefore, the owner is personally responsible for all debts and liabilities of the business, which means unlimited liability.

Option B is incorrect because transferring ownership in a partnership can be challenging, particularly if the partnership agreement does not specify the procedure for doing so.

Option C is incorrect because the corporate form of organization is commonly subjected to double taxation. A corporation pays taxes on its earnings, and the shareholders pay taxes on their dividends or capital gains.

Option D is incorrect because not all corporations practice one person, one vote. The voting power may be proportional to the number of shares held, or certain classes of shares may have superior voting rights.

Option E is incorrect because only some types of corporations are subject to the corporate income tax. For example, in the US, C-Corporations are typically subject to the corporate income tax, while S-Corporations are pass-through entities that do not pay a corporate income tax.

Which of the Following Statements Is CORRECT