Question

Which of the following are shared by a typical corporation and a limited liability corporation?

A. Easy to start and stop and have shared debt liability
B. Are incorporated and have limited liability
C. Have shareholders and are easy to start and stop
D. Protect personal assets and can sell stock to the public
Option 1: D. Protect personal assets and can sell stock to the public
Option 2: B. Are incorporated and have limited liability
Option 3: A. Easy to start and stop and have shared debt liability
Option 4: C. Have shareholders and are easy to start and stop

Answer 1

Typical corporations and limited liability corporations are both incorporated entities with limited liability for their owners, protecting personal assets and allowing them to raise funds through issuing stocks or bonds.

Step-by-step explanation:

The aspects shared by a typical corporation and a limited liability corporation (LLC) include being incorporated entities and offering limited liability to their owners. When a business incorporates, it is legally declared as a separate entity from its owners. This means that the personal assets of the shareholders are generally protected in the case of the company’s failures. Both types of business structures allow owners to only be liable up to the amount they have invested in the company. Additionally, corporations and LLCs can raise funds to finance their operations or new investments by issuing stocks and bonds, although selling stock to the public is typically associated with corporations rather than LLCs.