Which of the following statements is CORRECT? One of the disadvantages of a sole

Question

Which of the following statements is CORRECT? One of the disadvantages of a sole proprietorship is that the proprietor is exposed to unlimited liability. It is generally easier to transfer one's ownership interest in a partnership than in a corporation. One of the advantages of the corporate form of organization is that it avoids double taxation. One of the advantages of a corporation from a social standpoint is that every stockholder has equal voting rights, i.e., "one person, one vote." Corporations of all types are subject to the corporate income tax.

Explanation / Answer

It is easier to transfer corporate ownership through stock holding than partnership ownership transfer.

Corporate does not avoid double taxation as the tax paid dividend income from corporate is again taxable in receivers hand.

All corporate types are not subject to income tax as in S corporations Tax burden is transsferred to owners.

Preferred stock holders do not have voting rights , so all stock holders do not have equal voting rights.

The only Correct statement is "One of the disadvantages of a sole proprietorship is that the proprietor is exposed to unlimited liability"as unlike corporations proprietors need to assume all the risk and liabilities of the business.

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