Double taxation is a disadvantage of a corporation because the corporation has to pay income taxes at twice the rate applied to partnerships. a. True. b. False. | Homework.Study.com (2024)

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• Government regulations and double taxation on its income are the main disadvantages of the corporate form of business. (a) True (b) False.
• Both S-Corporations and C-Corporations are subject to double taxation because they owe taxes in their own right and their shareholders owe tax on any dividends they receive. a. True. b. False.
• True or false? Income for a partner incurs double taxation since the partnership is a taxable entity.
• True or false? An S-corporation is a type of corporation that avoids double taxation and also allows stockholders to receive limited liability.
• Partnerships pay no income tax. A) True B) False
• Partnerships pay no income tax. True False
• True or false? For tax purposes, a partnership and a corporation are treated in an identical manner.
• True or False: Partnerships pay no income tax.
• A partnership is not a tax paying entity, but must file a tax return. a. True. b. False.
• Answer true or false: Partnerships pay no income tax.
• Answer true or false: The C corporation tax rate is significantly lower than the top individual marginal tax rate.
• For tax purposes, a limited liability company may elect to be treated as a partnership. a. True b. False
• Corporation management is both an advantage and a disadvantage of a corporation compared to a proprietorship or a partnership. a) True b) False
• The net income of a partnership is taxed as a separate entity. a. True b. False
• True or false? The accumulated earnings tax may be imposed on the same corporation every taxable year.
• A partnership is subject to federal income taxes. a. True b. False
• A partnership will always be characterized as a partnership for tax purposes if the partnership elects to be treated as a partnership by filing a partnership tax return. A. True B. False
• True or false? The net income of a partnership is taxed as a separate entity.
• True or false? An S corporation cannot incur a tax liability at the corporation level.
• A partnership is a business owned by two or more people. a. True. b. False.
• Limited liability of stockholders, government regulations, and additional taxes are the major disadvantages of a corporation. a) True b) False
• Accounting True and False questions Corporate income is double taxed. Question 1 options: True False Question 2 (2 points) Corporate income is distributed to stockholders through stockdividends. Quest
• 1. Corporate income is double taxed. Question 1 options: _____True _____False 2. Corporate income is distributed to stockholders through stock dividends. Question 2 options: _____True _____Fal
• Corporate tax refers to a direct tax levied on the net earnings made by companies or associations and often includes the capital gains of a company. True False
• If a corporation pays taxes on its income, then stockholders will not have to pay taxes on the dividends received from that corporation. a. True b. False
• A partnership is not a separate taxable entity. a. True. b. False.
• True or false? The personal holding company tax may be imposed on a corporation that has previously been subject to the accumulated earnings tax.
• Income tax expense would be found on the income statement of a corporation, but not on the income statement of a sole proprietorship. a. True b. False
• Income tax payable represents the amount of taxes that a corporation owes but has not yet paid. True False
• A partnership is owned by two or more individuals. a. True b. False
• True or false? Corporations generally receive more favorable tax treatment than sole proprietorships and partnerships.
• True or false? An S corporation resembles an LLC for federal income tax purposes.
• Firms with consistent taxable incomes pay less federal taxes than firms with highly volatile taxable incomes. a. True b. False
• A disadvantage of partnerships is the mutual agency of all partners. a. True b. False
• A business cannot be taxed as a corporation unless it is incorporated under local law. (True/False)
• A limited liability company offers the limited liability of a partnership or proprietorship and the tax treatment of a corporation. a. True. b. False.
• The Accumulated Earnings tax may not be applied to publicly held corporations. A. True B. False
• Income tax is a tax levied on the income of individuals or businesses (corporations or other legal entities). True False
• A limited liability company is a business entity form designed to overcome some of the disadvantages of the partnership firm. a. True b. False
• The income of a limited liability company cannot be taxed to the members as though they were partners. a. True. b. False.
• Partners are taxed on their withdrawals, not on their share of partnership income. True or False?
• There is no entity level tax on an S Corporation except for the Built-In Gains Tax. True False Explain.
• Tax exempt interest income decreases the basis of each partner's interest in the partnership. (a) True (b) False.
• Determine whether the following statement is true or false: Congress recently changed the tax laws to make dividend income received by individuals exempt from income taxes. Prior to the enactment of that law, corporate income was subject to double taxatio
• Corporations pay federal and state income taxes. (a) True (b) False.
• If the income tax rate for a profitable company is 30%, a depreciation deduction of $10,000 results in a tax savings of $7,000 (before considering time value of money). True or false?
• A partnership is an association of three or more persons to carry on as co-owners of a business for profit. a. True. b. False.
• True or false? Corporations pay income taxes but their owners do not.
• Answer true or false: Unlike partnerships, corporations can pay dividends.
• The type of company structure affect's how income tax is paid therefore it is prudent to seek the advice of a tax professional when setting up your company. \\ A. true B. false
• The rates of a partner's distributive share of partnership income are exclusively those of the progressive rates used for individuals. True or False?
• ASC 740 applies to all taxes paid by a corporation. Explain. a. True b. False
• ASC 740 requires that a company treat potential interest and penalties related to an unrecognized tax benefit as part of its income tax provision. Explain. a. True b. False
• The net asset value of a partnership is equal to its revenue minus its expenses. A) True B) False
• The net asset value of a partnership is equal to its revenue minus its expenses. True False
• Partnerships always share income equally among all partners. a. True b. False
• A partnership is not an entity for financial reporting purposes. a. True. b. False.
• A company looking to issue debt instead of equity may want to consider debt due to favorable tax benefits. True or False
• A partnership will terminate, and its tax year will close, if the partnership ceases to carry on any business activity. a. True. b. False.
• True or false? A corporation is a separate entity for accounting purposes but not for legal purposes.
• Form 1041 illustrates the conduit theory of income taxation since all taxable income received by an estate or trust is taxed twice, like a C corporation. True False
• True or false? Both interest and dividends paid by a corporation are deductible operating expenses, so they decrease the firm's taxes.
• Determine whether the following statement is true or false: All corporations other than non-profit corporations are subject to corporate income taxes, which are 15% for the lowest amounts of income and 35% for the highest amounts of income.
• Bond interest paid by a corporation is an expense, whereas dividends paid are not an expense of the corporation. a. True b. False
• A tax shield is equal to the related non-cash expense multiplied by (1 - tax rate). a. True. b. False.
• A corporation must use a calendar year as its tax year unless it has a substantial business purpose to use a fiscal year. a. True b. False
• A corporation computing taxable income on the cash-basis method may use the accrual method for computing earnings and profits. A. True B. False
• Mutual agency is a major advantage of the partnership form of business. a. True b. False
• True or False: The net asset value of a partnership is equal to its revenue minus its expenses.
• True or false? S corporations are treated as partnerships under state property laws.
• True or false? If the tax laws were changed so that $0.50 out of every $1.00 of interest paid by a corporation was allowed as a tax-deductible expense, this would probably encourage companies to use more debt financing than they presently do, other things
• Partnerships have unlimited life. Corporations do not. True or False?
• A partnership is the most complex form of business. True or false?
• True or false? A partnership is an association of three or more persons to carry on as co-owners of a business for profit.
• Determine whether the following statement is true or false: All S corporations that were C corporations before electing S corporation status are subject to the tax on excess net passive income.
• True or false? S corporation status allows shareholders to realize tax benefits from corporate losses immediately.
• Similar to partners in a partnership, stockholders of a corporation have unlimited liability. True False
• True or False: Dividends appear as an expense on the corporation's Income Statement.
• Economic profit is equal to net operating profit less taxes paid minus a charge on invested capital. a. True b. False
• True or false? If a company reports revenues of $22,000 and expenses of $16,000, then net income equals $6,000.
• True or false? If a company reports revenues of $17,000 and expenses of $12,000, then net income equals $5,000.
• The tax benefits resulting from tax credits and tax deductions are affected by the tax rate bracket of the taxpayer. a. True b. False
• All differences between the book and taxable income, both permanent and temporary, affect a company's effective tax rate. Explain. a. True b. False
• Explain if the statement below is true or false. "The classical system of corporation tax is useful because it causes companies to retain more profit for investment purposes."
• The income tax law of 1913 established accounting income as a basis for taxation. a. True b. False
• A corporation does not have a legal obligation to pay dividends. A. True B. False
• Corporations avoid many of the state regulations and controls that proprietorships and partnerships are subject to. True or false?
• The relative lack of government regulation is an advantage of the corporate form of business. Is the statement true or false?
• Determine whether the following statement is true or false: All S corporations are subject to the tax on excess net passive income.
• A company may depreciate equipment over 10 years on a straight-line basis for its financial statements, but might use an accelerated method of depreciation over a shorter time period on its income tax return. True False
• Warner Company, an S corporation, pays the medical insurance for its sole shareholder, Scott. Scott can deduct this on his individual tax return. True or false? a. True b. False
• The retained earnings balance of a corporation is part of its paid-in capital. a. True. b. False.
• Revenue per employee may be used to measure partnership (LLC) efficiency. True of false?
• The income statement for a merchandising company presents only two amounts not shown on a service company income statement. a. True b. False
• Comparative financial statements are statements in which figures for a single company are presented for each of two or more periods. a) True b) False
• True or false: Most large, publicly traded companies use straight-line depreciation for book purposes but accelerated methods for tax.
• The legal requirements for forming a partnership can be quite burdensome. a. True. b. False.
• True or false? A corporation's net income does not necessarily equal its net cash flow from operations.
• The price to earnings ratio (P/E ratio) relates the prices a company charges for its products to the company's earnings. True or False?
• True and False. Explain all false answers. 1. Subchapter S refers to the " Partners and Partnership" Section of the Internal Revenue Code. 2. A court generally will hold a legislative regulation to be invalid if warranted. 3. The IRS responds to a taxp