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Ownership of a corporation is represented by _______________.
shares of stock. A corporation can have one or many shareholders.
What are they key advantages of corporations?
ability to raise capital via sale of stock; and limited liability of owners.
What are the key disadvantages of corporations?
Double taxation of business income, cost and complexity of formation and compliance, management constraints.
A corporations authority to act and liability for its actions are ____________ from the shareholders.
separate and apart (whatever that means..?)
Are shareholders liable for the debts, contracts or torts of the corporation?
Nope, they generally aren't. Limited liability for shareholders means that all they can lose is their investment in the stock. (sometimes the corporate 'veil' of limited liability can be pierced and they are liable)
Shareholders are liable for any debts they personally guarantee.
Who all can shareholders be?
Individuals, trusts, corporations, or any other entity
Who manages a corporation?
The shareholders elect board of directors
Who runs the corporation on a daily basis?
The board of directors hires officers to run corporation on a daily basis.
Where can stock be purchased?
Directly from the company or from other shareholders
What is a shareholders agreement?
Where shareholders may be restricted on who and when they can sell their shares
in the business (retained earnings) or distributedto the shareholders (dividends).
What do growth companies do with their earnings?
Reinvest instead of paying dividens
Where are corporations taxed?
by federal and state govts.
are shareholders taxed?
Yep, the dividends they receive are.
What does double taxation occur?
Describe the dividends of a corporation, who controls the sources of funds?
What are the classifications of corporations?
What are most corporations?
Describe close corporations.
Describe S corporations and PC corporations.
Describe piercing the corporate veil
What are factors a court considers with piercing the corporate veil?
What is the first step for corporate formation?
What are articles of incorporation?
Directors, Officers and Shareholders...
What is the role of directors?
What are directors meetings?
What are the rights of directors.
What are directors management responsibilities?
Whats the role of corporate officers and executives?
What are fiduciary duties of directors and officers?
Whats the business judgement rule?
Describe the duty of loyality of fiduciary duties of directors and officers