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Why might a small corporation organize as an S corporation? An S corporation (a) does not have
to issue stock (b) is not subject to the corporate income tax (c) is the only form of business
organization that offers limited liability (d) is the only form of business organization that
provides unlimited life. 11. Double taxation refers to the fact that (a) corporations have to pay
both state and federal taxes (b) the part of a corporation's earnings not distributed as dividends is
subject to excess profits taxes (e) corporations pay both income taxes and sales taxes (d)
corporations pay income taxes on their earnings, and the earnings that they distribute as
dividends are subject to personal income taxes.
Solution
10c11d

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