Which of the following statements is CORRECT? Two key advantages of the corporate form over other forms of business orga
Posted: Tue Jul 05, 2022 11:47 am
Which of the following statements is CORRECT?
Two key advantages of the corporate form over other forms ofbusiness organization are unlimited liability and limited life.
Although its stockholders are insulated by limited legalliability, the corporation's legal status does not protect thefirm's managers in the same way; i.e., bondholders can sue itsmanagers if the firm defaults on its debt, even if the default isthe result of poor economic conditions.
A corporation is a legal entity that is generally created by astate; its life and existence is separate from the lives of itsindividual owners and managers.
Limited liability of its stockholders is an advantage of thecorporate form of organization, but corporations have more troubleraising money in financial markets because of the complexity ofthis form of organization.
The main method of transferring ownership interest in acorporation is by means of a hostile takeover.
Two key advantages of the corporate form over other forms ofbusiness organization are unlimited liability and limited life.
Although its stockholders are insulated by limited legalliability, the corporation's legal status does not protect thefirm's managers in the same way; i.e., bondholders can sue itsmanagers if the firm defaults on its debt, even if the default isthe result of poor economic conditions.
A corporation is a legal entity that is generally created by astate; its life and existence is separate from the lives of itsindividual owners and managers.
Limited liability of its stockholders is an advantage of thecorporate form of organization, but corporations have more troubleraising money in financial markets because of the complexity ofthis form of organization.
The main method of transferring ownership interest in acorporation is by means of a hostile takeover.