[FINE 2000] - Midterm Exam Guide - Comprehensive Notes for the exam (50 pages long!)
6 Feb 2017
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Advantages: easy and inexpensive to form, all income is taxed on each partner"s personal income tax, partnership terminates if one partner dies or wishes to sell, ownership of limited partner is easily transferable. Difficult to sell: unlimited business debts for partners, limited life, difficulty in transferring ownership, ownership of a general partner is not transferable need to create a new agreement. Co-operative (co-op): an enterprise that is equally owned by its members share the benefits. Things that relate to profitability (i. e. sales, market share & cost control) Things that relate to controlling risk (i. e. bankruptcy avoidance, stability & safety) These 2 goals are somewhat contradictory so we must find the right balance. Sarbanes-oxley: created in response to corporate scandals from enron, worldcom, tyco and adelphia, congress reacted by creating the sarbanes-oxley act in 2002, aka sarbox. 1. 4 the agency problem and control of the corporation. Corporate expenditure benefits the management but hurts the shareholders.
