lecture2-350

lecture2-350 - Business Organization and Financial markets...

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Business Organization and Financial markets Some basic concepts Financial management: Lecture 2
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Financial management: Lecture 2 Today’s agenda Understand the types and features of business organizations Understand the goal of corporation and agency problem Understand financial markets and their functions Understand the concept of the cost of capital and the time value of money
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Organize a business Types of Business Organizations Sole Proprietorships A business owned and run by one individual Partnerships A business owned by two or more people Corporations A business organized as a separate legal entity owned by stockholders. Financial management: Lecture 2
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Organize a business Financial management: Lecture 2 Sole Proprietorship Partnership Corporation Who owns the business? The manager Partners Stockholders Are managers and owners separate? No No Usually What is the owner's liability? Unlimited Unlimited Limited Are the owner and business taxed separately? No No Yes
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Organize a business Financial management: Lecture 2 Sole Proprietorships Corporations Partnerships Limited Liability Corporate tax on profits + Personal tax on dividends Unlimited Liability Personal tax on profits
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Who is The Financial Manager? Chief Financial Officer
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lecture2-350 - Business Organization and Financial markets...

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