Which of the following is a disadvantage of a corporation when compared to a partnership?

A) The stockholders have limited liability.
B) The corporation is treated as a separate legal entity from the stockholders.
C) The corporation and its stockholders are subject to double taxation.
D) The corporation must account for the transactions of the business as separate and apart from those of the owners.

Double Taxation

A taxation principle referring to income taxes paid twice on the same source of earned income, occurring typically with corporate dividends taxed at both the corporate and individual level.

Corporation

A legal entity that is separate and distinct from its owners, offering limited liability, ease of transferability of shares, and perpetual succession.

Partnership

A legal form of business operation between two or more individuals who share management and profits or losses.