Question

What are the three important advantages of a proprietorship?

A. Is it easily and inexpensively formed, is it subject to few government regulations, and is it subject to lower income taxes than are corporations.

B. Is it easily and inexpensively formed, is it subject to no government regulations, and is it subject to lower income taxes than are partnerships.

C. Is it easily and inexpensively formed, is it subject to many government regulations, and is it subject to lower income taxes than are partnerships.

D. Is it easily and inexpensively formed, is it subject to no government regulations, and is it subject to lower income taxes than are corporations.

Answer 1

The three advantages of a proprietorship are: ease of formation, minimal government regulations, and lower income taxes than corporations.

Step-by-step explanation:

The three important advantages of a proprietorship are:

1. Easily and inexpensively formed: A proprietorship is the simplest form of business organization. It can be started with minimal paperwork and legal formalities.
2. Subject to few government regulations: Unlike partnerships and corporations, proprietorships have fewer regulatory requirements, making it easier for the owner to operate the business.
3. Subject to lower income taxes than are corporations: In a proprietorship, the business income passes through to the owner and is taxed based on the owner's personal tax rate, which is often lower than the corporate tax rate.