Tax Drill - Overview of LLCS Indicate whether the following statements are "True" or "False" regarding tax issues related to limited liability companies ( a. A partnership that reorganizes as an LLC is treated as having liquidated prior to forming the new entity. The transaction Is taxable to both the partnership and the partners. b. Because none of the LLC members are personally liable for any debts of the entity, the LLC is effectively treated as a limited partnership with no general partners. All owners of an LLC have the legal right to participate in the entity's management. C. d. State statutes differ from state to state as to the type of business an LLC can conduct -particularly as to the extent to which certain service-providing firms can operate as LLCS.

Tax Drill - Overview of LLCS Indicate whether the following statements are "True" or "False" regarding tax issues related to limited liability companies ( a. A partnership that reorganizes as an LLC is treated as having liquidated prior to forming the new entity. The transaction Is taxable to both the partnership and the partners. b. Because none of the LLC members are personally liable for any debts of the entity, the LLC is effectively treated as a limited partnership with no general partners. All owners of an LLC have the legal right to participate in the entity's management. C. d. State statutes differ from state to state as to the type of business an LLC can conduct -particularly as to the extent to which certain service-providing firms can operate as LLCS.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Which of the following is a disadvantage of general partnerships? a) A partner who withdraws from a partnership cannot be held liable for any debts the firm had at the time of withdrawal. b) Compared to the other forms of ownership, the paperwork and costs involved in forming a general partnership are the most extensive. c) All general partners have unlimited liability for the debts and obligations of their business. d) The partners in a general partnership are exposed to double taxation.
What are the unique financial reporting implications of the Partnership entity in comparison with the Proprietorship and Corporate structures? How does the closing process differ for the Partnership?
Which of the following statements is most true? a. The liability for other partners’ wrong doings is limited to the amount a particular partner has invested in the partnership. b. Partnerships are formed in accordance with specific guidelines that include the filing of a formal written agreement to the government. c. A fast growing firm would be more probable to establish a partnership as its business form than would a slow growing firm. d.Corporations can easier attract investors than those of the partnership and sole proprietor businesses.
In a limited liability company, profits are taxed as a partnership. True False
Please indicate which of the following statements is true regarding types of business entities? Multiple Choice O None of the choices are true. Ownership in a partnership is represented by having shares of common stock. For accounting purposes a sole proprietorship is not a separate entity from its owner. Sole proprietorships are subject to double taxation.
Which of the following is a distinguishing feature of a limited liability partnership? Question 10 options: a) It is intended to address the concerns of professionals who are not permitted to form corporations. b) It is a form of business that is not yet available in Canada. c) Its partners are shareholders. d) The liability of some of the partners is limited to their capital contribution.
B1.
2. options are Partnership Sole propitership LLC Corparation
A limited liability company (LLC): Multiple Choice Has owners called members. Is subject to double taxation.