Posted: April 30th, 2016

. Which statement is correct?

Hello I have been studying for the CPA for quite some time. I needs some help with these questions. I want to know if my answers are correct. Thank you

1. Which of the following gives the owners of the business limited liability?
a. proprietorship
b. partnership
c. Corporation
d. None of the above (THIS IS THE ANSWER)
Answer: I think that the answer here is D ( none of the above) because the LLC is the only one that can give owners of the business limited liability.

2. Which of the following gives priority to creditors in a dissolution?
a. A proprietorship
b. An LLC
c. A partnership (THIS IS THE ANSWER)
d. all of the above
Answer: C because usually personal creditors have first priority to personal assets; any excess goes to partnership creditors.

3. Which statement is correct?
a. A foreign corporation is one organized in another country but does business in the US
b. A foreign corporation is one organized in one state but does business in another state
c. Any type of business entity doing business abroad is a foreign company
d. None of the above is correct
Answer: B or D, because a foreign corporation is one doing business in any state except the state in which is was incorporated