Which of the following entities might file a form 1065?

Select one:

a. Partnership.

b. LLC.

c. S corporation.

d. More than one above.

Question 12

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Which of the following entities does not have limitedliability?

Select one:

a. General partnership.

b. LLC taxed as a disregarded entity.

c. S corporation.

d. All of the above have limited liability.

Question 13

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Which of the following entities has limited liability, flowthrough of income, and flexibility regarding allocation of incomeand loss?

Select one:

a. General partnership.

b. LLC.

c. C Corporation.

d. S Corporation.

Question 14

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Which, if any, of the following statements is (are) correct?

1. Excess distributed income over reasonable compensation istreated as self-employment income,
      in an LLC, for an LLC manager.

2. Excess distributed income over reasonable compensation istreated as dividend income in an S
      corporation.

Select one:

a. 1 only.

b. 2 only.

c. Both 1 and 2.

d. Neither 1 nor 2.

Question 15

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Which, if any, of the following statements is (are) correct?

1. C corporations offer limited liability.

2. Sole proprietorships offer limited liability.

Select one:

a. 1 only.

b. 2 only.

c. Both 1 and 2.

d. Neither 1 nor 2.

Question 16

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Your client, who is wealthy and in the top marginal income taxbracket, is interested in purchasing a franchise with some of hisfriends. After carefully reviewing the proposal, you havedetermined that apart from a large up-front investment, thebusiness will not need to retain income and income generated infuture years will be paid out to the investors.

Further, your client wants to be assured that after investing solarge an amount, the business would not be disrupted if one of hispartners lost interest, encountered personal financial reversals ordied.

What legal form of business meets the requirements of yourclient given these circumstances?

Select one:

a. A limited partnership.

b. A general partnership.

c. A C corporation.

d. An LLC.