Ryan Gosling wants to start a new business and has a question: "Which form of business is subject to double taxation of profits?" O Limited partnerships O General partnerships O Corporations O Sole proprietorship

Personal Finance
13th Edition
ISBN:9781337669214
Author:GARMAN
Publisher:GARMAN
Chapter16: Real Estate And High-risk Investments
Section: Chapter Questions
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Ryan Gosling wants to start a new business and has a question: "Which form of business is subject to double
taxation of profits?"
O Limited partnerships
O General partnerships
O Corporations
O Sole proprietorship
Transcribed Image Text:Ryan Gosling wants to start a new business and has a question: "Which form of business is subject to double taxation of profits?" O Limited partnerships O General partnerships O Corporations O Sole proprietorship
Considering the time value of money, which project should Beyoncé choose?
After Tax Cash Flows
Project 1
Project 2
Year 1
$15,000
Year 2
$15,000
O Beyoncé should choose project 1 because it helps her firm avoid taxes.
O Beyoncé should choose either project because cash flows are the same.
O Beyoncé should choose project 2 because the after-tax cash flows can be reinvested sooner.
O Beyoncé should base her decision on the net profit of each project.
Transcribed Image Text:Considering the time value of money, which project should Beyoncé choose? After Tax Cash Flows Project 1 Project 2 Year 1 $15,000 Year 2 $15,000 O Beyoncé should choose project 1 because it helps her firm avoid taxes. O Beyoncé should choose either project because cash flows are the same. O Beyoncé should choose project 2 because the after-tax cash flows can be reinvested sooner. O Beyoncé should base her decision on the net profit of each project.
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