Relaxant Inc operates as a partnership Now the partners have decided

Question

Relaxant Inc. operates as a partnership. Now the partners have decided to convert the business into a corporation. Which of the following statements is CORRECT?

a. Relaxant's shareholders (the ex-partners) will now be exposed to less liability.

b. The company will probably be subject to fewer regulations and required disclosures.

c. Assuming the firm is profitable, none of its income will be subject to federal income taxes.

d. The firm's investors will be exposed to less liability, but they will find it more difficult to transfer their ownership.

e. The firm will find it more difficult to raise additional capital to support its growth.

Answer

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