1. Which of the following is true of a corporation? If a description is false, why? a. Owners of a corporation have full liability. b. The corporation is taxed separately from its owners. C. The corporation has a life limited to its owners. 2. Upon formation, Apple Tree Corp. incurred the following expenses: incorporation fees, $2,200; legal fees, $1,500; and state incorporation fees, $4,000. Prepare the journal entry to record the payment of these expenses on January 1. 3. A corporation provides entity liability and will be a legal 4. Since the corporation is a separate legal entity, the life continues 5. Issuing stock gives the corporation an easy way to raise a large amount of and shareholders an easy way to transfer