[FINA 365] - Midterm Exam Guide - Everything you need to know! (30 pages long)
6 Feb 2017
Department
Course
Professor
Document Summary
All owners have limited liability but can also run business. Legally defined artificial being, separate from its owners. Has many legal powers and rights that people have. Corporate profits subject to taxes separate from owner"s tax obligations. Shareholders pay taxes twice (corp pays tax) (shareholders pay income tax) Profits are not subject to taxation at corporate level. Shareholders include these profits as income on their tax returns even if no money is distributed to them. Week 1 page 1 no money is distributed to them. Has enough cash on hand to meet its obligations from day to day. Managers put self-interest ahead of the interests of shareholders. When stock performs poorly or targets are not met: board might replace ceo or lower bonus. Corporate raider: break up a company or hostile takeover. Private corporation has limited number of owners and there is no organized market for its shares.
