Multiple Choice
The core goal of business is to generate long-term _____ by delivering _____ to their customers.
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1. Introduction to Accounting
Types of Accounting
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All of the following are types of direct participation programs (DPPs) except:
A
Common stock investments
B
Equipment leasing programs
C
Real estate partnerships
D
Oil and gas programs
Verified step by step guidance1
Understand the concept of Direct Participation Programs (DPPs): DPPs are investment vehicles that allow investors to directly participate in the cash flow and tax benefits of the underlying business. Common types include real estate partnerships, oil and gas programs, and equipment leasing programs.
Identify the characteristics of DPPs: DPPs typically involve limited partnerships or other pass-through entities where income, deductions, and tax benefits are passed directly to the investors.
Analyze the options provided: Common stock investments are not considered DPPs because they do not involve direct participation in the underlying business's cash flow or tax benefits. Instead, they represent ownership in a corporation.
Compare the remaining options: Equipment leasing programs, real estate partnerships, and oil and gas programs are all examples of DPPs because they allow investors to directly participate in specific business ventures.
Conclude that the correct answer is 'Common stock investments,' as it does not fit the definition or characteristics of a Direct Participation Program.
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