A Proprietor Who Operates His/her Own Business Can Incorporate and Become

Multiple Choice

A proprietor who operates his/her own business can incorporate and become the only shareholder. This action might be taken to provide the owner with the limited liability of the corporate form. Which of the following best describes the impact of incorporation in this situation on the limited liability issue?

A) The owner has achieved the full protection of limited liability.
B) The owner can protect his/her personal assets unless fraud is involved in the conduct of the business.
C) The owner has achieved the full protection of limited liability except for default on borrowed funds.
D) The owner has in reality achieved very little in the way of limited liability protection.