Corporation
A corporation is a form of business entity that is incorporated through the state charter and having a legal identity separate from its owners or the shareholders. Corporation forms of business entities dominate the business activities of Country U. The big businesses in the country are carried through corporations including the multinational business.
There are various advantages and disadvantages of corporation form of business as compared to other form of business.
a, b, c, d, e, f, and g.
To Identify: The advantages and disadvantages of corporate form of business from the given statements.
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- Income taxes are a unique expense of the corporate form of business.arrow_forwardWhich of the following characteristics is an advantage of the corporate form of business? a. Separation of ownership and management b. Higher degree of government regulation c. The potential to raise large amounts of capital d. Double taxationarrow_forwardWhich of the following statements is false concerning forms of businessorganization? a. A corporation has tax advantages over the other forms of businessorganization.b. It is easier for a corporation to raise large sums of money than it isfor a sole proprietorship or partnership.C. A sole proprietorship is an easy type of business to form.d. Owners Of sole proprietorships and partnerships have personalliability for the debts of the business while owners of corporationshave limited legal liability.arrow_forward
- The corporation is the most effective form of business organization because the corporation has: Select one: a) easier access to financial capital through selling bonds and stocks b) an unlimited liability toward the stock owners c) the problem of double taxation with respect to the corporate income d) a lot of skilled and semi-skilled labourers e) more freedom of action with respect to managementarrow_forwardWhich of the following is the primary element that distinguishes accounting for corporations from accounting for partnerships? a. The corporation draws a sharper distinction in accounting for sources of capital. b. The entity theory relates primarily to the other forms of business organization. c. In a corporation, retained earnings may be reduced only by the declaration of dividends. d. Generally accepted accounting principles apply to corporations but have relatively little applicability to other forms of business organizations.arrow_forwardUnder the corporate form of business organization, Group of answer choices a)ownership rights are easily transferred b)a stockholder is personally liable for the debts of the corporation c)stockholders’ acts can bind the corporation even though the stockholders have not been appointed as agents of the corporation d)stockholders wishing to sell their corporate shares must get the approval of other stockholdersarrow_forward
- Which of the following is not an advantage of the corporate form of business? a. limited liability b. easy transferability of shares c. enhanced ability to raise capital d. lack of government regulationarrow_forwardWhich of the following is not an advantage of the corporate form of business organization? a) unlimited life b) transferability of ownership c) limited liabilitiy of stockholders d) unlimited personal. liability for stockholdersarrow_forwardWhich of the following statements is true? A. the organizational form that is the easies to raise capital is the corporation B. corporations make up the largest proportion of businesses in the U.S C. sole proprietorships are protected by limited liability D. owners of corporations are not protected by limited liabilityarrow_forward
- What are some reasons why the value of a business other than a small one is generallymaximized when it is organized as a corporation?arrow_forwardWhich of the following statements is CORRECT? a. Most business in the U.S. is conducted by corporations, and corporations' popularity results primarily from their favorable tax treatment. b. Corporations and partnerships have an advantage over proprietorships because a proprietor is exposed to unlimited liability, but the liability of all investors in the other types of businesses is more limited. c. Conflicts can exist between stockholders and managers, but potential conflicts are reduced by the possibility of hostile takeovers. d. A good goal for a firm's management is the maximization of expected EPS. e. For a stock to be in equilibrium, its intrinsic value must be greater than the actual market price.arrow_forwardWhich of this statement shows the advantage to form a corporation? Select one: a. Owner must absorb all losses b. Ability to raise large amounts of capital is increased c. Control of corporation not guaranteed by partial ownership of stock d. Business terminates immediately upon death of ownerarrow_forward
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