Which statement regarding corporations is most accurate?
A)Due to limited liability, unlimited lives, and ease of ownership transfer, the vast majority of businesses are organized as corporations.
B)Due to legal considerations related to ownership transfers and limited liability, most business is conducted by corporations in spite of large corporations' often less favourable tax treatment.
C)Large corporations are taxed more favourably than sole proprietorships.
D)Corporate stockholders are exposed to unlimited liability.

Question

Quizplus · Accepted Answer

The statement that due to legal considerations related to ownership transfers and limited liability, most business is conducted by corporations in spite of large corporations' often less favourable tax treatment is the most accurate statement. The other options are not accurate. Option A is incorrect as the vast majority of businesses are not actually organized as corporations. Option C is incorrect as large corporations are actually taxed less favourably than sole proprietorships. Option D is incorrect as corporate stockholders have limited liability, meaning they are not personally responsible for the corporation's debts and obligations beyond their investment in the corporation.

Which Statement Regarding Corporations Is Most Accurate