Intro to Business Ch. 4

Limited liability company (LLC)

Form of ownership that provides limited liability and taxation like a partnership but places fewer restrictions on members

Nonprofit corporations

Corporations that fous on providing a service rather than earning a profit but are not owned by a government entity

Leveraged buyout (LBO)

A purchase in which a group of investors borrows money from banks and other institutions to acquire a company (or a division of one), using the assets of the purchased company to guarantee repayment of the loan

Preferred stock

A special type of stock whose owners, though not generally having a say in running the company, have a claim to profits before other stockholders do

Corporate charter

A legal document that the state issued to a company based on information the company provides in the articles of incorporation

Corporation

A legal entity, created by the state, whose assets and liabilities are separate from its owners

Joint venture

A partnership established for a specific project or for a limited time

General partnership

A partnership that involves a complete sharing in both the management and the liability of the business

Limited partnership

A business organization that has at least one general partner, who assumes unlimited liability, and at least one limited partner, whose liability is limited to his or her investment in the business

Private corporation

A corporation owned by just one or a few people who are closely involved in managing the business

Public corporation

A corporation whose stock anyone may buy, sell, or trade

Partnership

A form of business organization defined by the Uniform Partnership Act as "an association of two or more persons who carry on as co-owners of a business for profit"

Board of directors

A group of individuals, elected by the stockholders to oversee the general operation of the corporation, who set the corporation's long-range objectives

Cooperative (co-op)

An organization composed of individuals or small businesses that have banded together to reap the benefits of belonging to a larger organization

Sole proprietorships

Businesses owned and operated by one individual; the most common form of business organizations in the United States

S corporation

Corporation taxed as though it were a partnership with restrictions on shareholders

Quasi-public corporations

Corporations owned and operated by the federal, state, or local government

Articles of partnership

Legal documents that set forth the basic agreement between partners

Dividends

Profits of a corporation that are distributed in the form of cash payments to stockholders

Initial public offering (IPO)

Selling a corporation's stock on public markets for the first time

Stock

Shares of a corporation that may be bought or sold

Common stock

Stock whose owners have voting rights in the corporation, yet do not receive preferential treatment regarding dividends

Merger

The combination of two companies (usually corporations) to form a new company

Acquisition

The purchase of one company by another, usually by buying its stock