Which form typically has perpetual existence and is often used to raise capital by issuing stock?

Which form typically has perpetual existence and is often used to raise capital by issuing stock?

• A. C Corporation
• B. Cooperative
• C. Sole Proprietorship
• D. Limited Partnership

Answer: (A)

Corporations are separate legal entities that continue to exist regardless of who owns them, giving them perpetual existence. They can raise substantial capital by selling stock to investors, allowing ownership to be spread widely and funds to come from many sources. The form that fits both features—perpetual existence and raising capital through stock issuance—is the C corporation, which can issue a large number of shares (including different stock classes) to attract investment. In contrast, a sole proprietorship ends if the owner leaves or passes away; a cooperative is member-focused and not primarily about raising capital through stock; and a limited partnership relies on partners rather than broad stock issuance.

Corporations are separate legal entities that continue to exist regardless of who owns them, giving them perpetual existence. They can raise substantial capital by selling stock to investors, allowing ownership to be spread widely and funds to come from many sources. The form that fits both features—perpetual existence and raising capital through stock issuance—is the C corporation, which can issue a large number of shares (including different stock classes) to attract investment. In contrast, a sole proprietorship ends if the owner leaves or passes away; a cooperative is member-focused and not primarily about raising capital through stock; and a limited partnership relies on partners rather than broad stock issuance.