Alejandro is a stockholder in a software consulting firm.He gets a share of the earnings of the firm,on which he has to pay taxes.Moreover,the firm pays taxes on its earnings.As an individual,Alejandro is not legally liable to pay off the debts that might be incurred by the firm.In this scenario,the software consulting firm can be regarded as a _____.
A)sole proprietorship
B)partnership
C)corporation
D)franchise

Question

Quizplus · Accepted Answer

The firm is described as having a separate legal identity from its owners (shareholders like Alejandro), where it pays taxes on its earnings and the shareholders also pay taxes on dividends. This double taxation and limited liability for shareholders are characteristic of a corporation.

Alejandro Is a Stockholder in a Software Consulting Firm