{[ promptMessage ]}

Bookmark it

{[ promptMessage ]}

Exam 4 Lectures - Chapter9 16:04 Corporation...

Info icon This preview shows pages 1–4. Sign up to view the full content.

View Full Document Right Arrow Icon
Chapter 9 16:04 Under what business entity am I going to operate my business? Historically Three Choices Corporation Sole proprietorship Partnership How long do I want this to last?  How do I raise capital?  Limited liability is an  issue.   Oldest is a sole proprietorship. o No special requirements.  Put a sign out that says open. o Taxes not an issue o Getting money is an issue o Liability issue – responsible for all Partnership o No formal requirements – pretend like there are formal requirements and  do a written, detailed partnership agreement. o Less partnerships than anything else.  usually don’t work out. Corporation o At first were more of a right to almost create monopolies o Severe state requirements.  State law in this chapter, not federal. o Most business in this country are done through corporation.  Most of the  BIG businesses are corporations. o Corporation can sue and be sued in its own name which means  shareholder has limited liability. o As a shareholder, all you're going to lose is your investment.  You don’t  have to pay back any debt.
Image of page 1

Info icon This preview has intentionally blurred sections. Sign up to view the full version.

View Full Document Right Arrow Icon
o Corporate taxation All three have advantages and severe disadvantages.  Why cant we come up  with a structure that has good and good?  IRS is always in the way. Attempts to Create a New Business Entity Limited Partnership o Two classes of partners o General partnership – general partner has unlimited liability.  Responsible  for all debt.  Limited partner has limited liability, only responsible for their  investment. o Doesn’t have to file a tax return, the partners do. o Problem is the limited partners have no control in the operation of the  limited partnership. Closely held corporation o Board of directors meetings o Private corporations o Must document everything you do – pain o Not gonna see this for large corporations, mostly mom and pop stuff S-Corporation o Created just like a C-Corporation. o Once you have the corporate charter, ten your accountant certifies to the  IRS that you meet all the requirements of an S-Corporation. o Very detailed and lengthy requirements. o Limited to no more than 100 shareholders.  Cant be readily transferable.  o Only one class of shareholders.  Has to be individual and U.S. citizen.  Money flows to shareholders and shareholders pay the taxes. o IRS can change the requirements
Image of page 2
Professional Corporation o Limited for attorneys, doctors, professionals.
Image of page 3

Info icon This preview has intentionally blurred sections. Sign up to view the full version.

View Full Document Right Arrow Icon
Image of page 4
This is the end of the preview. Sign up to access the rest of the document.

{[ snackBarMessage ]}

What students are saying

  • Left Quote Icon

    As a current student on this bumpy collegiate pathway, I stumbled upon Course Hero, where I can find study resources for nearly all my courses, get online help from tutors 24/7, and even share my old projects, papers, and lecture notes with other students.

    Student Picture

    Kiran Temple University Fox School of Business ‘17, Course Hero Intern

  • Left Quote Icon

    I cannot even describe how much Course Hero helped me this summer. It’s truly become something I can always rely on and help me. In the end, I was not only able to survive summer classes, but I was able to thrive thanks to Course Hero.

    Student Picture

    Dana University of Pennsylvania ‘17, Course Hero Intern

  • Left Quote Icon

    The ability to access any university’s resources through Course Hero proved invaluable in my case. I was behind on Tulane coursework and actually used UCLA’s materials to help me move forward and get everything together on time.

    Student Picture

    Jill Tulane University ‘16, Course Hero Intern