Concept check

Date: 2015-10-07; view: 524.

1. Read each statement and decide whether it is true or false.

1) A corporation is the least complex of the three business structures.

2) Ownership is readily transferable in the corporation.

3) In the case of illness, death or other cause for the loss of an officer, the corporation stops to exist.

4) Delegation of management is one of the advantages of the corporation.

5) Corporation provides fewer incentives because a manager doesn't share the profit.

6) Double taxation is one of the disadvantages of a corporation.

7) The level of secrecy in a corporation is greater in than in a partnership.

8) By selling and buying stocks the stockholders may vote.

2. Ask questions that may produce the following answers.

1) A corporation is an artificial being endowed by law with the rights, powers and duties of a natural person.

2) Corporations have to send their stockholders a report every year including audited financial statement.

3) The board of directors is responsible for drafting and amending the company.

4) Usually, a corporation is chartered for long life until its dissolution.

5) Because management and ownership are separated, managers may not have a direct interest in the profitable growth of the company.