Bad brad's bbq had cash flows for the year as follows ($ in millions): cash received from: customers $ 3,300 interest on investments 220 sale of land 110 sale of common stock 520 issuance of debt securities 2,300 cash paid for: interest on debt $ 310 income tax 90 debt principal reduction 1,650 purchase of equipment 4,900 purchase of inventory 850 dividends on common stock 280 operating expenses 550 bad brad's would report net cash inflows (outflows) from investing activities in the amount of: $(2,490). $110. $(4,790). $(4,900).

Which of the following statements is correct? large corporations are taxed more favorably than sole proprietorships. corporate stockholders are exposed to unlimited liability. due to limited liability, unlimited lives, and ease of ownership transfer, the vast majority of u.s. businesses (in terms of number of businesses) are organized as corporations. most businesses (by number and total dollar sales) are organized as partnerships or proprietorships because it is easier to set up and operate in one of these forms rather than as a corporation. however, if the business gets very large, it becomes advantageous to convert to a corporation, mainly because corporations have important tax advantages over proprietorships and partnerships. most business (measured by dollar sales) is conducted by corporations in spite of large corporations’ often less favorable tax treatment, due to legal considerations related to ownership transfers and limited liability.