Example #4 ? Corporations are distinguished by the subchapter in chapter 1 of the IRS code that governs their tax structure. 7) The board should establish a suitable committee structureconsistent with the institution's size and complexitythat encourages open participation by independent directors iv) Managers = Agent, AgencyAction Binding the Corporation Types of Authority, i) Actual Authority Principal specifies expressly what the agent is authorized to do, through words or conduct c) Must be comprised entirely of independent directors So, the minimum grand total for forming a California corporation is $125. Did these ratios get stronger or weaker in 2016 compared to 2015? Apple. Tip. 2 Which one of the following is not a characteristic of a corporation? Once a public corporation sells its initial offering of stock, it is not part of any subsequent transfers except as a record keeper of share ownership. all the positive, good character traits, at least: Strong (mentally!) The five main characteristics of a corporation are limited liability, shareholder ownership, double taxation, continuing lifespan and, in most cases, professional management. is the process of starting and managing your own business. Stock of a privately held company is not traded on an exchange and there are usually only a small number of stockholders. 1) What are the voting rights that s/s are able to exercise? a) The ratification only applies to that specific transaction, does not create future authority, 1) The majority of directors should be independent of the company and its management Capital acquisition. 5) Was made by a director or directors who otherwise were not independent i) If there is an emergency, the notice requirement can be waived, A) Directors Corporations are created under state or federal laws and have many of the same legal rights as a person . Similarly, a person or an entity wishing to purchase stock in a corporation does not require the approval of the corporation or its existing stockholders before purchasing the stock. (6) The degree of discretion shown by the allegedly dominant corporation; Life span. However, this special order would not have a sales commission. Prepare the December 31 adjusting entry and the entry on Monday, January 6, when Lovrek pays the payroll. C) Rationale is that if a corporation used its own treasury funds then s/h who produce revenue for the corporation could be supporting a politician they don't support. Corporations have an indefinite life. Business Law in Canada, 11e (Yates) Chapter 11 Corporations. ii) No one factor is decisive John David Jackson, Patricia Meglich, Robert Mathis, Sean Valentine, Calculus for Business, Economics, Life Sciences and Social Sciences, Karl E. Byleen, Michael R. Ziegler, Michae Ziegler, Raymond A. Barnett, Elliot Aronson, Robin M. Akert, Samuel R. Sommers, Timothy D. Wilson. 6) Amend the Bylaws, Warrant gives the creditor the option to buy the stock by a particular time, for a particular price, and when this is exercise the corporation has to issue additional stock to cover the obligation, i) A bond is a loan to the company for a fixed period of time Goal setter 6. a) *Current ratio = Current Assets / Current Liabilities* B) With contract creditors, plaintiffs will have had every opportunity to get personal guarantees in the contracts, or to protect themselves in the event that funds were not available; whereas, with a tort, it kind of just happens and you can't prepare for it 1) CEO and CFO must personally certify that the financial statements are in fact accurate, Accounting & Financial Reporting - Retained Earnings, A) The cumulative amount the company has retained from its products i) Accrual method says that what we want to do is determine when you are entitled to receive revenue and when we want to record that during that period Advantage of Corporations. boycott. If the order was accepted, the tires would be shipped overseas for an additional shipping cost of $7.50 per tire. (adsbygoogle = window.adsbygoogle || []).push({}); Copyright 2023 Find what come to your mind. Assume that the real interest rate, predicted inflation, and inflation are all equal to zero. a) At-will dissolved by any partner withdrawal 1) Dividends Corporation Has. One that can be called on when needed, the next best choice you could have taken (Because there are never enough resources to produce all the goods and services people want there must be trade-offs. You'll get a detailed solution from a subject matter expert that helps you learn core concepts. 7 Which is characteristic of a limited liability company ( LLC )? ii) Board = Agent/Principal Key Characteristics of Different Taxes . iii) Paid in equity + retained earnings = Total Equity, Accounting & Financial Reporting - Retained Earnings - Ratio's, i) Investors look at financial statements in different ways, such as So let?s get into a list of character traits ? b) *Debt/Equity Ratio = Long-term Debt / Total Equity* a) Is that third party reasonable in assuming that the agent has the authority to bind the principal? What are the Characteristics of Corporations? \end{array} 1 What are the characteristics of a corporation quizlet? acts, thinks, and feels in a way that matches some commonly accepted ?good? Prepare a differential analysis dated January 21 on whether to reject (Alternative 1) or accept (Alternative 2) the special order from Euro Motors. a. inventory Characteristics of Entrepreneurs 1.Risk taker 2. 3) If the corporation becomes insolvent, and its assets must be liquidated, debt securities will have priority over equity securities Promoting from within cuts recruitment and training costs. A low inventory turnover. 5) Inventory = goods held for use in production or for sale to customers (average cost method; first in, first out method; last in, last out method) Advantage of Corporations. D: Which of the following is true with regard to the characteristics of corpora- tions? D) Setting clear policies and monitoring the institution's operations for compliance Legal status 5. Additional taxes Corporations must pay federal and state income taxes as a separate legal entity. Ownership in a corporation is represented by stock certificates, which is why the owners are called stockholders. maintaining employment process training and development staff. Instead, it is a separate taxable entity which is taxed at both the corporate and shareholder levels. A. shareholders who have limited liability B. shareholders who are mutual agents C. its inability to own property D. direct management by the shareholders (owners) Characteristics of a corporation . A company shareholder is personally liable for the debt of the corporation. c) At least three of them have to be financially literate Stockholders consist of founders and key investors; not publicly traded; individuals act as s/h and assume the position of directors and officers typically. Brightstone is evaluating a special order from a European automobile company, Euro Motors, Euro is offering to buy 20,000 tires for$116 per tire. Clothing should always be clean and ironed properly. Relative ease of transferring ownership rights. Enter a Melbet promo code and get a generous bonus, An Insight into Coupons and a Secret Bonus, Organic Hacks to Tweak Audio Recording for Videos Production, Bring Back Life to Your Graphic Images- Used Best Graphic Design Software, New Google Update and Future of Interstitial Ads. What are 2 characteristics of a corporation? (2) Inadequate capitalization (big one); v) Dissolved by withdrawal of a general partner, i) Legal entity separate from shareholders A corporation is a legal entity, meaning it is a separate entity from its owners who are called stockholders. Fundamentals of Financial Management, Concise Edition, Marketing Essentials: The Deca Connection, Carl A. Woloszyk, Grady Kimbrell, Lois Schneider Farese, Donald E. Kieso, Jerry J. Weygandt, Terry D. Warfield. CHARACTERISTICS OF A CORPORATION 1. Most corporate detectives avoid terms like spying and espionage, preferring the more dignified label "competitive intelligence", but whatever they call it, snooping on business rivals has become an entrenched sub-industry. A person with ?good character? Characteristics of a professional medical corporation include it being --designated as an HMO or IPA. They think of others. CORPORATIONS GENERALLY IS ABOUT HUMAN RELATIONSHIPS IN THE BUSINESS CONTEXT. v) Manager-managed: managers act for LLC; members vote on major matters CliffsNotes study guides are written by real teachers and professors, so no matter what you're studying, CliffsNotes can ease your homework headaches and help you score high on exams. Government regulation 4. A general corporation may have an unlimited number of stockholders that, due to the separate legal nature of the corporation, are protected from the creditors of the business. D) Meeting materials are sent in advance, but board members do little or no preparation Characteristic Corporations 1. Assume December 31 falls on a Tuesday, so Lovreks employees have worked 2 days without being paid. Separate Legal Existence. Was 2016 stronger or weaker than 2015? B) Instead, they need to set up Political Action Committees (PAC) & raise revenues separately and can support that way a) Internal Auditor B) Cash flow just makes certain type of adjustments as to which components of the statement reflect where cash is going in and going out Examine these ideal beliefs and significance weights, and then create a verbal description (i.e., concept) of a new brand for these items that would satisfy this student's needs. A) This limited liability means that a corporation's creditors can look only to the corporation's assets for payment for their claims b) To rebut the presumption, P must show Creditors are limited to corporate assets for satisfaction of their claims. Some images used in this set are licensed under the Creative Commons through Flickr.com.Click to see the original works with their full license. 1) The holder of a debt security typically expects to receive only fixed payments of interest over time and the return of the principal on the maturity date of the debt. The filing fee for Articles of Incorporation is $100. Public companies are governed under rules of the Securities and Exchange Commission ( " the SEC " ). An investment expert makes all of the buy and sell decisions, as source of supply, support, or aid. Partnership income and expenses are said to "flow/pass through" to the partners in proportion to their ownership interests. A corporation is treated as a "person" with most of the rights and obligations of a real person. jmu women's field hockey roster They can exist until the business decides to terminate. 9) Management and the board of directors should have formal succession plans in place that are reviewed annually C) Actively helping plan the long-term direction and goals for the institution 1) Generally, this means a member must be able to read and understand fundamental financial statements By setting up a PAC only those who support the politician can give money 4) Debt securities can be secured or unsecured and are called bonds, debentures, or notes, B) A corporations articles of incorporation specify how many shares of common stock and preferred stock the corporation is authorized to issue Published on 22 Oct 2018. \end{array} E) Knowing where the institution stands and staying abreast of its financial health \begin{array}{lr} Can adapt to changes Industrial businesses a) It is an action in equity brought by a shareholder on behalf of the corporation c) When sold, they are authorized and issued or authorized and outstanding Ability to raise large capital amounts 2. 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