The correct answer is: B. Corporation
A corporation is a legal entity that is separate from its owners. This means that the corporation can own property, enter into contracts, and sue and be sued. The owners of a corporation are called shareholders. Shareholders are not personally liable for the debts of the corporation. This means that if the corporation goes bankrupt, the shareholders’ personal assets cannot be used to pay off the corporation’s debts.
Corporations are created by state law. Each state has its own laws governing corporations. To form a corporation, you must file a document called a “articles of incorporation” with the state. The articles of incorporation must include the name of the corporation, the purpose of the corporation, the number of shares that the corporation will issue, and the names and addresses of the initial directors of the corporation.
Once a corporation is formed, it is a separate legal entity from its owners. This means that the corporation can own property, enter into contracts, and sue and be sued. The owners of a corporation are called shareholders. Shareholders are not personally liable for the debts of the corporation. This means that if the corporation goes bankrupt, the shareholders’ personal assets cannot be used to pay off the corporation’s debts.
Corporations are often used to conduct business. This is because corporations offer a number of advantages over other forms of business organization, such as sole proprietorships and partnerships. These advantages include limited liability, perpetual existence, and ease of transfer of ownership.
Limited liability means that the shareholders of a corporation are not personally liable for the debts of the corporation. This means that if the corporation goes bankrupt, the shareholders’ personal assets cannot be used to pay off the corporation’s debts.
Perpetual existence means that a corporation does not have to dissolve when one of its shareholders dies or sells their shares. This is in contrast to a sole proprietorship, which dissolves when the sole proprietor dies or sells their business.
Ease of transfer of ownership means that it is relatively easy to transfer ownership of shares in a corporation. This is done by simply selling the shares to another person. This is in contrast to a partnership, which requires the consent of all of the partners to transfer ownership of the partnership.
In conclusion, the correct answer to the question “Legal entity separation from its legal owners and managers with help of state laws is classified as” is: B. Corporation.