What is a C corporation and what are the advantages of this type of business ownership?
What will be an ideal response?
A C corporation is a form of business organization that is a separate entity apart from its owner, legally formed under state laws. Advantages of C corporations include the following:
Limited liability: The personal assets of the owners are not at risk.
Company paid fringes: C corporations are allowed to provide benefits to its employees, which can reduce the company's tax obligation by using the fringe benefits as legal deductible expenses.
Tax savings: C corporations are taxed at 15% for the first $50,000 of profits, creating a nice tax benefit for smaller corporations.
Capital: Obtaining capital is easier through the sale of stock.
You might also like to view...
The net operating cycle is:
A. inversely related to a company’s need for liquidity. B. the length of time it takes for an investment in inventory to be returned from collected accounts. C. the sum of the number of days of inventory and the number of days of receivables, less the number of days of payables.
A certificate is a mechanism to verify an identity on a computer system over a computer network
Indicate whether the statement is true or false