Zephyr Case Study - 1. The C Corp is a legal entity that is...

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1. The C Corp is a legal entity that is separate from its owners, is not limited to the life of its owners and investors and is the liable party, not the owners, for the debts of the business. The advantages of a C Corp are: unlimited access to capital through the sale of stock or bonds, unlimited life, and limited liability of the corporation’s investors and owners. The disadvantages include: an annual audit, difficult to form and hefty fees, a lot of paperwork, business ownership is widely held, double taxation and the requirement of a personal guarantee by banks. The S Corp has the advantages of both a corporation and a partnership. The S Corp is a legal entity that has a small group of owners, minimal federal reporting, limited liability of the owners and investors and no double taxation. It’s disadvantages are the stock is not publicly held, which leads to more limited capital, 75 or fewer shareholders and you can still be sued if blatantly negligent. With the S Corp, only one class of stock can be outstanding, it must operate on a calendar year basis and all stockholders must be US residents. This form of organization would be a good fit initially for Zephyr, as it has limited liability of investors, unlimited life, ability to transfer interest, ability to secure
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Zephyr Case Study - 1. The C Corp is a legal entity that is...

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