Question

The advantage of a corporation over a partnership is:

are easily transferable to another person.
b.perpetual existence.
is easier to raise funds.
d.All the above.

Answer 1

A corporation offers the advantages of easily transferability of shares, perpetual existence, and the ease of raising funds. Unlike partnerships, they are considered separate legal entities with limited liability for owners. While they face more regulations and taxes, corporations enable greater opportunities for growth and protection for investors.

Step-by-step explanation:

The advantages of a corporation over a partnership include:

1. Shares are easily transferable to another person.
2. Perpetual existence, meaning the corporation can continue indefinitely beyond the lives of its shareholders.
3. It is easier to raise funds; a corporation can issue stock or bonds to generate capital.

Corporations are seen as separate legal entities which can sue, be sued, enter into contracts, and can file for bankruptcy. They provide limited liability to their shareholders, who are only at risk of losing their investment in the corporation but are not personally liable for its debts. Furthermore, a corporation can hire specialized management, which helps in professional operations and growth.

Compared to partnerships, which can also be easy to form and manage, corporations have the distinct advantage of not being dependent on the life or involvement of a particular individual or individuals. If a partner leaves or passes away, a partnership might have to be dissolved, while a corporation will continue to exist.

However, corporations also come with disadvantages such as stringent government regulations, potentially heavy tax burdens, and the cost associated with establishing and maintaining corporate status.