CAS AS 105 Lecture Notes - Double Taxation, C Corporation, Transaction Cost
Document Summary
Chapter 1: corporate finance and the financial manager. Valuation principle: weigh costs and benefits properly to make the best decision. Life of the business depends on the life of the owner b. Partnerships: business owned by 2 or more people. Ends with the death or withdrawal of a single partner. Partners can avoid liquidation by buying out the partner that left. Limited partners: limited liability of just their investment. Limited liability companies (llc): no general partners c. Corporations: legal entity separate from its owners i. Owners and employees are not liable, vice versa. Requires a charter by the state of business ii. Dividend: payment made at the discretion of the corporation. Proportional to the amount of stock every person owns iii. Since dividend is income, it is taxed again at the personal level. S corporations: under sub-chapter s of the irs, they are exempt from double taxation. C corporations: not exempt from taxes because they do not restrict stockholders.
