Stock Terminology. A corporation is treated as a person with most of the rights and obligations of a real person. d) Disinterested and independent (has two methods of analysis = duty of loyalty (2) Inadequate capitalization (big one); Investors in a corporation need not actively manage the business, as most corporations hire professional managers to operate the business. Assume that the real interest rate, predicted inflation, and inflation are all equal to zero. 1) If they find no irregularities they offer a "clean" opinion that it represents fairly in all material aspects Less Is More. a) *Current ratio = Current Assets / Current Liabilities* Competitive: I thrive under pressure. bookmarked pages associated with this title. 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 Money borrowed against a home or land. To be recognized as a corporation, a business must file an application that includes the corporation's articles of incorporation (charter) with the State, pay an incorporation fee, and be approved by the State. What are some good character traits to have? What is the nervous system tissue called? acts, thinks, and feels in a way that matches some commonly accepted ?good? iii) Perpetual life The five main characteristics of a corporation are limited liability, shareholder ownership, double taxation, continuing lifespan and, in most cases, professional management. iii) Officers = Agent/Principal iii) BJR creates a presumption that, "in making a business decision, the directors of a corporation acted on an informed basis, in good faith, and in the honest belief that the action was taken in the best interest of the company a) Oversees the way senior executives are paid B) In order for the board to act, it must 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. It can be easier for a corporation to acquire debt and equity, since it is not constrained by the financial resources of a few owners. The par value of corporate shares issued represents a corporation?s legal capital. Business Law in Canada, 11e (Yates) Chapter 11 Corporations. B) Special Meetings Can be called pursuant to articles that are set forth in the bylaws, needs to give notice & some general information about what the meeting will be about (8) Whether the corporations are treated as independent profit centers (big one); Courteous : I care about workplace atmosphere. Which is a disadvantage of a corporate structure? The filing fee for Articles of Incorporation is $100. c) Informed and rational basis = duty of care (Hint: The consumer will attempt to maintain constant consumption for her final two life periods as long as she can consume at least $20,000 in each period after she reaches middle age.). ii) Second "Accounting stage" B) Represents the difference/surplus between revenues and cost Here are certain characteristics that are not representative of corporations: The stockholders of a corporation have unlimited liability. b) Survey the extent to which there are processes set up for the board to act effectively and for the directors to be held accountable The so-called S corps do not pay corporate taxes, but rather they transfer income,. Characteristics of a corporation include a alimited lifespan b. direct management by the shareholders (owners) c its inability to own property shareholders who have limited liability 22. 1? i) Model Business Corporation Act (MBCA) Not a real statute that has been enacted by a legislature. b. Relative ease of transferring ownership rights. is a business owned by two or more people who share its risks and rewards. If she does not believe that the agent has the authority, the principal is under a duty to investigate 100,000 & 275,500 & 3.00 Corporations have a number of distinguishing characteristics. boycott. A good logo is: Simple. Life span. (d) You borrow money in August from RBC Financial Group. (6) The degree of discretion shown by the allegedly dominant corporation; 1) GAAP (Generally Accepted Accounting Principals): Bridgewater Corp. offered holders of its 1,000 convertible bonds a premium of $160 per bond to induce conversion into shares of its common stock. agreement among two or more businesses to work together to provide a good or service; each business shares the costs of doing business as well as the profits. Accounting & Financial Reporting - Bookkeeping works within following three categories a) Internal Auditor first line of defense against financial fraud It can be easier for a corporation to acquire debt and equity, since it is not constrained by the financial resources of a few owners. Additional taxes. (10) Intermingling of property between entities Are you sure you want to remove #bookConfirmation# Corporations are distinguished by the subchapter in chapter 1 of the IRS code that governs their tax structure. 1 What are the characteristics of a corporation quizlet? - a. the making of a program to manage finances through budgeting and investment. Watch on Forbes: 1. 8) The board, through its audit committee, should verify the institution's financial management strength and effectiveness through an annual external audit Positive character traits are those things that draw us to other people. 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 Terms in this set (8) A) Average Cost Method visualizes inventory as sold at random from a bin They are polite. i) Court's won't usually impose this strict approach on contract creditors, but they may do it for financial institutions or lenders, Piercing the Corporate Veil -- Equitable Ownership of the Corporation, A) An individual who exercised sufficient control over the corporation may be deemed to be an "equitable owner," notwithstanding the fact that the individual is not a shareholder of the corporation Example #1 ? Stockholders consist of founders and key investors; not publicly traded; individuals act as s/h and assume the position of directors and officers typically. Usually represents a very large portion of the assets of firms engaged in financing businesses Retrieve the 2016 Under Armour financial statements at www.sec.gov by clicking on Filings and then searching for Under Armour under Company Filings. Double taxation of dividends c. Charter d. i) External affairs of a corporation are generally governed by the law of the place where the activities occur and by federal and state regulatory statutes rather than by the place of incorporation vi) No member liability 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 refusal to buy a company's services or product. Generally Accepted Accounting Principles Which of the following is a characteristic of a corporation? c) When sold, they are authorized and issued or authorized and outstanding C. The title of the corporation is limited by the death of the owner Which of the following is a characteristic of a limited liability company (LLC)? a) Somewhat analogous to apparent authority, can be said that inherent authority is a type of apparent authority Published on 22 Oct 2018. Par. Top 9 Examples of Most Common Corporations OutputTCMC25,000$100,000$0.5050,000150,0001.0075,000187,5002.50100,000275,5003.00\begin{array}{rrr} and any corresponding bookmarks? ii) Debt Securities generally are the least risky and have the lowest expected return. Personal assets of stockholders are not available to creditors or lenders seeking payment of amounts owed by the corporation. d) If they are repurchased by the corporation they become authorized and issued, but not outstanding, Before a corporation that has issued all the shares authorized by the articles of incorporation can issue more stock, it must amend the articles of incorporation to authorize additional shares c) If you or a family member are affiliation in any way with some outside auditor of the company, i) *Audit Committee* The most significant of these are: Separate Legal Existence Continuous Life Ability to Acquire Capital Transferability Limited Liability Government Regulations Taxation Governance and Management Let's look at each of these in turn. Its charter may limit the corporation's life although the corporation may continue if the charter is extended. 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 The stock of a public company is traded on a stock exchange. c. lead time Question: Which of the following is true with regard to the characteristics of corporations? Members of Gen Zloosely, people born from 1995 to 2010are true digital natives: from earliest youth, they have been exposed to the internet, to social networks, and to mobile systems. 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 1) Analysts typically like a 2:1 ratio, this suggests you have enough cushion to pay your bills as they become due 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. What are 2 characteristics of a corporation? Once the approval is received, the corporation must develop its bylaws. iv) Board of directors manage 3. Creditors are limited to corporate assets for satisfaction of their claims. Which one of the following is not a characteristic of a corporation? v) Common shareholders elect board and vote on major matters b) Long-term liabilities Debts due more than one year from the balance sheet date, Accounting & Financial Reporting - Equity, Equity (sometimes referred to as net worth) represents the accounting value of the interests of the firm's owners D: Which of the following is true with regard to the characteristics of corpora- tions? b) Outside Auditors Ambitious 5. Since the corporation is a separate legal entity, the owners do not have the power to bind the corporation to business contracts. The five main characteristics of a corporation are limited liability, shareholder ownership, double taxation, continuing lifespan and, in most cases, professional management.. 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characteristics of a corporation quizlet
