Unformatted text preview: personal liability 2. Limited ability to raise funds 1. Costly to organize 2. Possible double taxation of income Corporate governance - The way in which corporations are structured and the impact a corporation’s structure has on the firm’s behavior. Separation of ownership from control - In many large corporations the top management, rather than the shareholders, control day-to-day operations. Principal-agent problem - A problem caused by an agent pursuing his own interests rather than the interests of the principal who hired him. Liability - Anything owed by a person or a business. Balance sheet- A financial statement that sums up a firm’s financial position on a particular day, usually the end of a quarter or a year....
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- Fall '06
- Corporation, corporations Corporation, corporation Partnership, PARTNERSHIP CORPORATION PROPRIETORSHIP, firm Limited liability, limited liability Asset