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Chapter 1:
Questions:
7.What ar the significant financial advantages and disadvantages of the restore proprietary/ union form in comparison with the bodily form?
1 ) The profits be shargond altogether by sole proprietor or in in the midst of the partners , while in corporate form the profits are searched with the number of shareholders that the company holds.
2) In sole proprietor and partnership the level of investments are not that large so the mensuration can easily be built through profits.
3) mend proprietorships and partnerships cost less to establish while corporate forms throw off hugh legality that be.
4) Sole proprietors and partners are not liable for unemployment policy while a corporation is required to pay unemployment insurance taxes on his or her salary
Disadvantages :
1) A corporation has many avenues to dress down capital. It can sell shares of stock and create new types of stock, such as preferred stock. Loans are easily provided to corporation thusly Sole proprietor and Partnership businesses.
2) Ownership interests in a corporation may be sold to third parties without trouble the continued operation of the business.
A sole proprietorship or partnership, on the other hand, cannot be sold whole. Instead, each of its assets, licenses and permits essential be individually transferred.
3) Due to large business transactions, Corporations are able to get discounts on material, transportation and other costs thus creating financial economics of scale which sole owners and partners are not able to create.
4) Earnings from a sole proprietorship are render to self-employment taxes, with a corporation, only salaries are subject to such taxes while earnings are not subjected to taxes.
Problems:
be Records and Cash Flow Example 1.1, Page 9
1.Sussman Industries purchased a bore machine for $50,000 and paid cash....If you want to get a upright essay, order it on our website: Orderessay
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