Question

The advantages of the partnership form of business organization, compared to corporations, include

a. single taxation.
b. ease of raising capital.
c. mutual agency.
d. limited liability.
e. difficulty of formation.

Answer 1

Partnership form of business organization offers advantages such as single taxation, ease of raising capital, and mutual agency compared to corporations.

Step-by-step explanation:

The advantages of the partnership form of business organization, compared to corporations, include:

1. Single taxation: Each partner pays taxes on their share of the income; the business itself does not have to pay taxes.
2. Ease of raising capital: Partnerships can easily attract investors and raise capital through contributions from partners.
3. Mutual agency: Partners have the authority to bind the partnership and make decisions on its behalf.

In comparison, corporations have the advantage of limited liability, as owners' personal assets are protected from the obligations of the business. However, partnerships offer advantages in terms of taxation and ease of raising capital.