Chapter 5 self study

a LLC has the choice of taxation and can be taxed as a _____ or a corporation

partnership

A corporation allows people to own ___ and share in the profits of the firm

stock

the number of an S corporation's _____ is limited to no more than 100

stockholders

disadvantage of a corporation?

double taxation and cost of forming a corporation

no stock, limited life span, and fewer incentives are disadvantages of a

LLC

Advantages of Limited Liability Company

Limited liability Choice of taxation Flexible ownership rules Flexible distribution of profits and losses Operating flexibility

a unique government creation that looks like a corporation but is taxed like a sole proprietorship or partnership is a called a _ corporation

S

A unique government creation that looks like a corporation but is taxed like sole proprietorships and partnerships is called a

S corporation

One company's purchase of the property and obligations of another company is an

acquisition

one company's purchase of the property and obligations of another is called

aquistion

a corporation is formally formed with

articles of incorporation and bylaws

a corporation is formally formed with..

articles of incorporation and bylaws

In addition to the articles of incorporation, a corporation has ___ ,which describe how the firm is to be operated from both legal and managerial points of view

bylaws

firms in unrelated industries united to diversify business operations and investments. soft drink company/snack company

conglomerate merger

When producers, consumers, or workers with similar needs pool their resources for mutual gain; they start a

cooperative

The ___ form of business allows people to become owners without having to work at the firm

corporate

the _____ form of business allows people to become owners without having to work at the firm

corporate

A ____ is a state-chartered entity that exists in the eyes of the law and controls risk to the owners of the firm

corporation

a legal entity with authority to act apart from its owners

corporation

the goal of a ____ cooperative was to join together to get better prices for their food products

farm

another kind of cooperative in US is formed to give more economic power as a group. they don't pay the same kind of taxes corporations pay

farm cooperative

a partnership meaning that all partners share in operating the business

general partnership

Drew and Owen are partners. Drew invests money and manages the business, Owen invests money but hes not managing. Drew is a ____ partner and Owen is a ____ partner

general, limited

when a soft drink company and a mineral water company merge and then are able to supply variety of drinking products, they have formed a____ merger

horizontal

A sole proprietorship has a limited life span unless

its sold to someone else or is taken over by heir

LCC's are considered to have operational flexibility because while they must submit articles of organization, they are NOT required to:

keep minutes or hold annual meetings

LLC's have operational flexibility because while they must submit articles of organization, they aren't required to..

keep minutes or hold annual meetings

leaving a _____ means owners can leave an ongoing business for future generations

legacy

A ___ is an attempt by employees, management, or a group of investors to purchase an organization primarily through borrowing

leveraged buyout

The responsibility for a loss only up to the amount is ____ liability

limited

a ____ partnership has partners who do not share in operating the business

limited

if the sole proprietor dies, is incapacitated, or retires, the business no longer exists. this disadvantage is called ____ life spand

limited

the form of business ownership called ___ ___ protects the person's personal assets from the debt of the business

limited liability

when the continued operation of the business is dependent on the life of the business owner, it is referred to as..

limited life span

when there is one or more general partners and one or more limited partners, the firm is a

limited partnership

The ____ limited partnership looks much like a corporation with how it acts and is traded on a stock exchange

master

When two firms join together to form one new company, it is called a

merger

The Limited Lability Partnership ensures that the limited partners' ____ assets are not at risk

personal

individuals who start and manage a business are concerned with risk. they may choose to incorporate to decrease

personal liabilities

When you own a sole proprietorship you and the business are considered one, so you have ___ liability for financial obligations such as debt

unlimited

if your company debts or damages are solely your responsibility you could be experiencing the disadvantage associated with owning a sole proprietorship called..

unlimited liability

A merger that joins two companies involved in different but related levels of an industry is a(n) _ merger

vertical

when two firms operating in different stages of related businesses join, it is called a ____ merger

vertical