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Exam Code: DCP-315P

Exam Name: Lenovo Data Center Technical Sales Practice Exam (DCP-315P)

Version: V22.75

Q & A: 580 Questions and Answers

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Jones, Smith, and Bay wanted to form a company called JSB Co. but were unsure about which type of
entity would be most beneficial based on their concerns. They all desired the opportunity to make taxfree
contributions and distributions where appropriate. They wanted earnings to accumulate tax-free.
They did not want to be subject to personal holding tax and did not want double taxation of income. Bay
was going to be the only individual giving management advice to the company and wanted to be a
member of JSB through his current company, Channel, InC. Which of the following would be the most
appropriate business structure to meet all of their concerns?
A. S corporation.
B. Limited liability partnership.
C. C corporation.
D. Proprietorship.
Answer: B
Choice "d" is correct. An LLP does not pay taxes on its earnings. Instead, the profits and losses flow
through to the partners as in a general partnership. The LLP files an informational tax return like that of a
general partnership. The partners may agree to have the entity managed by one or more of the partners.
A partner may be another entity.
Choice "a" is incorrect. A proprietorship by definition has only one owner, not three owners.
Choice "b" is incorrect. While an S corporation allows for the same treatment of its earnings and
distributions as in the facts, it is prohibited from having another company as an owner.
Choice "c" is incorrect. A C corporation pays its own taxes on its earnings, and any distributions to its
shareholders are again taxed at the shareholder level (known as "double taxation").

You are working on a case that pertains to a common issue encountered by customers. You discover a
new solution to resolve the issue. You need to ensure that all users can find the new solution. What
should you do?
A. Share the case with all of the users.
B. Create a solution file.
C. Assign the case to a team that includes all of the users
D. Create a knowledge article.
Answer: D

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