One of the main reasons many entrepreneurs choose to elect S corp status is because of its tax benefits. The sale of stock results in government regulation to protect stockholders, the owners of the corporation. Capital acquisition. Privately held companies may have some restrictions on the transfer of stock. \end{array} b) Typically, preferred stockholders will receive a fixed dividend payment although the declaration of a preferred stock dividend is also at the discretion of the board of directors When someone is generous, kind, energetic, or optimistic they exude energy that attracts others. (7) Whether the dealing between the entities are at arms length; Once the approval is received, the corporation must develop its bylaws. The five main characteristics of a corporation are limited liability, shareholder ownership, double taxation, continuing lifespan and, in most cases, professional management. 1. What does a universal WiFi Internet adapter do? b. iii) Inherent Authority Infers from the position holds that the agent has authority ability of profit-making organizations to compete with businesses in other countries effectiveness making the right decisions about what products or services to offer customers and how to produce and deliver them efficiency producing needed goods or services quickly and at a low cost domestic goods products made by firms in the United States (9) Payment of guarantee of the corporation's debt by the dominating entity; and Calculate ratios for 2015 and 2016 to determine the following for Under Armour: Stock Terminology. Clothing should always be clean and ironed properly. Particularly in a public company, the stock can be easily transferred in part or total at the discretion of the stockholder. \text { Output } & \text { TC } & \text { MC } \\ Capital acquisition. 2023 Course Hero, Inc. All rights reserved. 75,000 & 187,500 & 2.50 \\ The stockholder wishing to transfer (sell) stock does not require the approval of the other stockholders to sell the stock. (5) Common office space, address, and telephone numbers of corporate entities; Characte joint venture. A) Closed Corporation Held by a small group of people and not publicly traded. Who is the most powerful person in a corporation? Legal status Separate legal entity 8. i) Alter ego is demonstrated "by evidence showing a blending of identities, or a blurring of lined distinctions, both formal and substantive, between two corporations." They compliment others when deserved. ii) No one factor is decisive 1) Labor laws that govern employees; environmental law; etc. iv) *Governance Committee* Retrieve the 2016 Under Armour financial statements at www.sec.gov by clicking on Filings and then searching for Under Armour under Company Filings. iii) *Nominating Committee* b) Responsible for establishing the terms of any stock options executives may get as compensation Characteristics of an Effective Leader. Assume the company does not use reversing entries. 5) A well-publicized whistle-blower process should be established so employees, vendors, and customers can anonymously report concerns Legal status 5. a) Current liabilities Debt the firm owes that must be paid within one year of the balance sheet date Disadvantage of Corporations. Additional taxes Corporations must pay federal and state income taxes as a separate legal entity. --owned by shareholders. There may be thousands, even millions, of stockholders in a public company. The corporation?s resources are limited to what the stockholders can contribute. How does the CPI differ from the Myers-Briggs test? Tax status of income Previous question Next question The same is true for any lawsuits or insurance claims against the company. Ownership. a) Internal Auditor Determine another student's ideal beliefs and the significance of those beliefs for a spa. What are some of the characteristics of a corporation? Tip. (2) Such control has been used to commit a fraud or other wrong; and In general, the chief executive officer (CEO) is considered the highest-ranking officer in a company, while the president is second in charge. Corporation acts under its own name rather than in the name of its stockholders. a. 2) Even if the corporation does well, the holder of the debt security only receives a fixed payment Stockholders consist of founders and key investors; not publicly traded; individuals act as s/h and assume the position of directors and officers typically. a market where stocks and bonds are traded. Example #1 ? Corporations are created under state or federal laws and have many of the same legal rights as a person . Dividends. a) Presentation of the corporations financial statements fairly and accurately reflects the financial position of the company A number of characteristics distinguish a corporation from a sole proprietor or partnership. Some of the main characteristics of small businesses are: They can be further categorized. Dividends. What are the Characteristics of Corporations? Can adapt to changes Industrial businesses Living, $475.75; fixed,$679.65; share of annual, $291.17. Can have current assets, fixed assets, and intangible assets Example #4 ? Creditors are limited to corporate assets for satisfaction of their claims. b) Be composed solely of independent directors A corporation is not allowed to hold public office or vote, but it does pay income taxes. One of the disadvantages of a corporate structure is the corporation pays its own tax burden on net income and then the stockholders pay income tax on the dividends they receive. 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) Oversees the way senior executives are paid Removing #book# A) Average Cost Method visualizes inventory as sold at random from a bin B/C the principal puts the agent in a position of trust, the principal should bear the loss, AgencyAction Binding the Corporation Types of Authority Ratification of Authority , Focuses on the principal, if the agent has acted w/out authority but the principal takes no steps to repudiate the authority and accepts the benefits of the authority, than we can say that the principal has ratified the authority Limited liability. ii) Duty of care requires a director to act in the corporations best interest and to exercise reasonable care in overseeing the corporations affairs and in making business decisions C) Most important is cash flow from operating activities For the calculation of averages, use the following amounts for 2014: total assets =$2,095,083; total stockholders equity = $1,350,300. Ease of formation Requires government approval 3. This statement is true. However, this special order would not have a sales commission. Shareholders participate, as shareholders, in the management of the corporation. Assume, based on your response in the previous section, that the customer will earn$100,000 during their middle years. service business. d. overhead costs. What are the characteristics of a corporation quizlet? Being a person with good character means you act with honesty, respect, responsibility, caring, and other ?good? vii) Majority vote by directors and shareholders, Characteristics of a Limited Liability Company, i) Legal entity distinct from members Note that output is measured as the number of bottles of vitamins produced per day and that costs include a normal profit. b. Some persons may be employed to help the owner but ultimate control lies with him. Since the corporation is a separate legal entity, the owners do not have the power to bind the corporation to business contracts. Stockholders have the right to: vote for the members of the Board of Directors and any other items requiring stockholders action; receive dividends when authorized by the Board of Directors; have first right of refusal when additional shares are issued, thereby allowing the stockholder to maintain the same ownership percentage of the company before and after the new shares are issued (called a preemptive right); and share in assets up to their investment, if the company is liquidated. Means that the relationship between shareholders and managers (directors and officers), will be governed by the corporate statutes and case law of the state where the corporation is incorporated 2) Note that these outside auditors are hired by management are in a position that their performance will decide whether they are hired next year and so on, creating its own issues C) Last in, last out Method visualizes inventory as being added to and sold from the top of the stack, Accounting & Financial Reporting - Fixed Assets , Sometimes referred to as long-term assets or as property plant and equipment, are assets a firm uses to conduct its operations I) Ensuring and maintaining the board's independence, Red Flags of Deficiency in Governance to Watch For, A) A strong or dominant CEO "runs the show," soliciting little or no input from others and not tolerating the opposing view Money that can be borrowed as you need it, which must be paid back with interest. b) *Debt/Equity Ratio = Long-term Debt / Total Equity* The companys ability to pay its current liabilities. Ownership of a corporation is held in shares of capital stock, which are transferable units. According to Lance Wilkins, founder of Call Outdoors, passionate leaders are the backbone of thriving businesses. Example #2 ? 1 Corporations enjoy most of the rights and responsibilities that individuals possess: they can enter contracts, loan and borrow money, sue and be sued, hire employees, own assets, and pay taxes. iii) Officers = Agent/Principal 1) Dilution Reduction in the economic return of your shares and the voting power and control you can exert by owning those shares, The most basic of all corporate securities B) The typical test of unfairness is that the entity has been undercapitalized, where a corporation will be using the corporate form only to avoid liability Apple. 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 Usually represents a very large portion of the assets of firms engaged in financing businesses The filing fee for Articles of Incorporation is $100. It is a team of people, including suppliers of money and labor, who work together to earn a return on their investment. Exxon Mobil. Top 9 Examples of Most Common Corporations People pool their money together to buy a variety of stocks. How to Market Your Business with Webinars? D: Which of the following is true with regard to the characteristics of corpora- tions? Less is more, fewer is better, and simple rules are the common mantra here. a) Partnership is not a taxpaying entity. Was 2016 stronger or weaker than 2015? Money borrowed against a home or land. C) The purpose of the doctrine of piercing the corporate veil is to prevent an independent corporation from being used to defeat the ends of justice to perpetuate fraud, to accomplish a crime, or otherwise to evade the law, Piercing the Corporate Veil -- Tort Creditors vs. Contract Creditors, A) Courts make the distinction between contract creditors and tort creditors Memorable. Corporate managment. The stock of a public company is traded on a stock exchange. develop products for distribution from raw goods, change raw goods into a more finished form, provide service to consumers and other businesses, provide goods and services to business and individual, refusal to buy a company's services or product. The five main characteristics of a corporation are limited liability, shareholder ownership, double taxation, continuing lifespan and, in most cases, professional management. In a corporation, one stockholder cannot jeopardize other stockholders through poor decision making. is a business owned by two or more people who share its risks and rewards. Stock of a privately held company is not traded on an exchange and there are usually only a small number of stockholders. vii) Can elect tax treatment as partnership Published on 22 Oct 2018. Kremlinomics alludes to the communist policies of the Russian government during the . \text{Direct materials}&\$56\\ b) Anytime you're dealing w/ a wholly owned subsidiary, it's a good idea for the other company to do its due diligence and inquire whether the subsidiary is authorized to act in the way that it is acting w/out approval of its parent company, AgencyAction Binding the Corporation Types of Authority Inherent Authority , Inherent Authority Infers from the position holds that the agent has authority This statement is true. (2) Inadequate capitalization (big one); How long does it take for braces to close gaps. So let?s get into a list of character traits ? Assume December 31 falls on a Tuesday, so Lovreks employees have worked 2 days without being paid. Key Characteristics of Different Taxes . At its most basic level, what is corporations about? Stockholders legally own the corporation, but they manage the corporation indirectly through a board of directors they elect. There are two types of securities: debt and equity B) A corporations articles of incorporation specify how many shares of common stock and preferred stock the corporation is authorized to issue Equity securities Equity securities consist of common stock and preferred stock Separate Legal Existence 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, the minimum grand total for forming a California corporation is $125. Expert Answer. B) Instead, they need to set up Political Action Committees (PAC) & raise revenues separately and can support that way A) Gives companies the general guidelines and requirements of how to do your financial statement, i.e., things that you have to do when making these reports $$ Examples of personal positive qualities: kind, gentle, strong, resilient, caring, assertive, hard-working, reliable, honest, practical, responsible, loyal, mature, creative, consistent, appreciative, capable, quick, sensitive, perceptive, patient, thoughtful, fit, trustworthy, shows initiative, motivated, versatile. What are some good character traits to have? What is the unit product cost using absorption costing? Study online at quizlet/_4on6v. The five main characteristics of a corporation are limited liability, shareholder ownership, double taxation, continuing lifespan and, in most cases, professional management.. What are some features of a corporation quizlet? Organization costs, including legal fees, underwriters' fees for stock and bond issues, and incorporation fees, are recorded as an intangible asset and amortized over a period of time not to exceed 40 years. Will consumption remain the same over the course of the consumer's life? Question: Chapter 12 21. It may be established as a profit making or nonprofit organization and may be publicly or privately held. The board, in turn, formulates operating policies and also selects officers to execute policy and to perform daily management functions. c) The most common forms of preference are the right of the preferred stockholders to receive a dividend before any dividends are paid to the holders of common stock and the right to receive distributions in liquidation before any distributions are made to the common stock. What are 2 characteristics of a corporation? (adsbygoogle = window.adsbygoogle || []).push({}); Copyright 2023 Find what come to your mind. A corporation is treated as a "person" with most of the rights and obligations of a real person. There are two types of securities: debt and equity, Equity securities consist of common stock and preferred stock, 1) Common stock assumes the greatest risk of the success or failure of the corporate and has the greatest expected return. Some refer to it as a ?legal person.? iv) Structurally, the BJR implements the basic corporate attribute of centralized management by insulating the board's decision-making prerogatives from shareholder and judicial second-guessing. What are 2 characteristics of a corporation? Since a corporation is a separate legal entity, creditors have recourse only to corporate assets to satisfy their claims. Microsoft. Members can assign their economic rights in the LLC. 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. i) Factors person who buys the rights to operate the business, recognized company that allows independent owners to use their name. Characteristics of Entrepreneurs 1.Risk taker 2. Characteristics of a corporation Rating: 6,3/10 1466 reviews A corporation is a business entity that is legally recognized as an individual separate from its owners. a) Gross negligence is the standard for board of directors c. UNLESS- the shareholder/s guarantee the debts of the company. CORPORATIONS GENERALLY IS ABOUT HUMAN RELATIONSHIPS IN THE BUSINESS CONTEXT. A shareholder's liability is limited to the amount he or she paid for the shares. Owner liability 8. from your Reading List will also remove any Nearly every large US company has an intelligence office of some kind. 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