A corporation is a legal entity, organized under state laws, whose investors purchase shares of stock as evidence of ownership in it. The advantages of the corporation structure are as follows: Show
What are the Disadvantages of a Corporation?The disadvantages of a corporation are as follows:
A private company has a small group of investors who are unable to sell their shares to the general public. A public company has registered its shares for sale with the Securities and Exchange Commission (SEC), and may also have listed its shares on a stock exchange, where they can be traded by the general public. The requirements of the SEC and the stock exchanges are rigorous, so comparatively few corporations are publicly-held. Try the multiple choice questions below to test your knowledge of Chapter 2. Once you have completed the test, click on 'Submit Answers for Grading' to get your results. If your lecturer has requested that you send your results to them, please complete the Routing Information found at the bottom of your graded page and click on the 'E-Mail Results' button. Please DO NOT forward your results unless your lecturer has specifically requested that you do so. This activity contains 21 questions.In finance we refer to the market for short-term government and corporate debt securities as the __________ market.Which of the following would generally have unlimited liability?The Chance Dice Corporation had taxable income (excluding capital gains) of $16 million. The firm's $10,000 of realized capital gains will be taxed at __________.A corporation in the U.S. estimates and pays it taxes __________.The average tax rate is equal to the __________.Accounting.com has purchased 3-year class equipment for $100,000. It uses the MACRS method of depreciation. What is tax depreciation for the fourth year?In finance we refer to the market where existing securities are bought and sold as the __________ market.Which of the following is not an example of a financial intermediary?How are funds allocated efficiently in a market economy?What mechanism ensures that large firms who benefit from tax laws pay some minimum amount of tax?A profitable firm would prefer to use which of the following methods of depreciation -- for tax purpose -- for a given depreciable asset, all else equal?A major disadvantage of the corporate form of organization is the __________.Which of the following examples would be deductible as an expense on the corporation's income statement?A corporation that receives $1,000 in dividends from another corporation, of which they have owned 10% for one full year, will be taxed on how much of those dividends?In finance we refer to the market where new securities are bought and sold for the first time as the __________ market.Limited liability companies (LLCs) generally possess no more than two of the following four (desirable) characteristics: (1) limited liability, (2) centralized management, (3) unlimited life, and (4) the ability to transfer ownership interest without prior consent of the other owners. The two characteristics most likely to be absent in LLCs are __________.Which of the following is an advantage of a corporation that is not an advantage as a limited partner in a partnership?Which of the following statements is correct for a sole proprietorship?What is potentially the biggest advantage of a small partnership over a sole proprietorship?In finance we refer to the market for relatively long-term financial instruments as the __________ market.Limited liability companies (LLCs) generally possess no more than two of the following four (desirable) characteristics: (1) limited liability, (2) centralized management, (3) unlimited life, and (4) the ability to transfer ownership interest without prior consent of the other owners. Which of the following forms of business organization in the U.S. generally possesses all four of these characteristics?Which of the following is advantages of the corporate form of organization?Advantages of a corporation include personal liability protection, business security and continuity, and easier access to capital. Disadvantages of a corporation include it being time-consuming and subject to double taxation, as well as having rigid formalities and protocols to follow.
Which of the following are advantages of the corporate form of business quizlet?The corporate form has the advantage of unlimited liability. The corporate form is preferred over the sole proprietorship because a corporation is easier to form and faces less regulation.
What are the advantages of the corporate form of organization over that of the partnership?One of the biggest differences between the two structures is the amount of legal protection that's provided. A corporation would offer the highest level of protection, as all owners would have limited liability. In a partnership, at least one owner would typically have unlimited liability.
Which of the following is not an advantage of the corporate form of organisation?Other than this, double taxation is also a disadvantage for a corporation. Limited liability of shareholders, easy transfer of ownership, going concern, etc are advantages for a corporate form of business.
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