becomes a shareholder and owner of the corporation. Shareholder and corporations are liable. THE LIMITED LIABILITY OF SHAREHOLDER One of the key advantages of the corporate forms is the limited liability of its owners. Corporate shareholders normally are not personally liable for the obligations of the corporation beyond the extent of their investments. CORPORATE TAXATION Corporate profits are taxed‚ and do not receives tax deduction for dividends distributed to shareholders. Profits that are
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What is the connection between wealth and education? Is it education gives us wealth‚ or wealth gives us an education? Education is our knowledge on things that we have learnt and things that we understand. Whilst wealth isn’t just about how much money we have. It’s about being wealthy through our health and heart‚ also emotionally and physically wealthy. It is all that is desired to be truly happy with one and another. So‚ what is the connection between wealth and education? There is
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Cultural Differences on Work Goals Table of Contents CHAPTER 1 INTRODUCTION 1.1 Background of the Study Culture is a vital matter that could be illustrated and characterized in number of ways. Regardless‚ culture refers to the man’s medium that structures the human life of a single person. Consequently‚ there is not one part of human life that is not touched and modified by culture. This means psyche; how individuals communicate‚ the way they consider‚ how they move‚ how issues are settled
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The owners of a corporation are the Shareholders. They control the firm’s management by controlling the corporation’s direction‚ policies and activities. First‚ they elect a Board of Directors‚ who then‚ select top management. These members of top management serve as corporate officers and manage the operations of the corporation in the best interest of the shareholders. An agency relationship exists between stockholders and management because the shareholders select the directors of the Corporation
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The Shareholders vs. Stakeholders Debate T he stakeholder theorists smell blood. Scandals at Enron‚ Global Crossing‚ ImClone‚ Tyco International and WorldCom‚ concerns about the independence of accountants who are charged with auditing financial statements‚ and questions about the incentive schema and investor recommendations at Credit Suisse First Boston and iMerrill Lynch have all provided rich fodder for those who question the premise of shareholder supremacy. Many observers have claimed that
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private placement of shares as compared with a public issue. (1 mark) 3. The shareholders of Quinninup Ltd hold 25 000 A class ordinary shares‚ fully paid at $4.50 each. On 17 April 2012‚ the company directors voted to make a 1 for 5 rights offer to these shareholders. The additional shares were offered at $1.75 each‚ payable in full one month after acceptance. The offer closed on 31 May 2012 with 90% of the shareholders accepting. Shares were duly allotted on that date and all monies were received
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increasing the shareholder value has aroused wide concern among various circles. In view of this issue‚ creating shareholder value maybe is a main point to allow the company to achieve success in their marketplace. According to Alfred Rappaport ‚ there are 10 ways that can create shareholder value. The first one is ‘Do not manage earnings or provide earnings guidance’ .A lot of companies are keen on reducing the spend of their expenditure because they want to achieve the net profit . Companies
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Stakeholders vs. Shareholders The definition of business strategy is a long term plan of action designed to achieve a particular goal or set of goals or objectives. Stakeholder is a person‚ group‚ or organization that has direct or indirect stake in an organization because it can affect or be affected by the organization’s actions‚ objectives‚ and policies. Shareholder is someone who owns shares of stock in a corporation or mutual fund. For corporations‚ along with the ownership comes a right
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profit maximization Definition A process that companies undergo to determine the best output and price levels in order to maximize its return. The company will usually adjust influential factors such as production costs‚ sale prices‚ and output levels as a way of reaching its profit goal. There are two main profit maximization methods used‚ and they are Marginal Cost-Marginal Revenue Method and Total Cost-Total Revenue Method. Profit maximization is a good thing for a company‚ but can be a bad thing
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Chapter 158 Distributions to Shareholders: Dividends and Repurchases ANSWERS TO END-OF-CHAPTER QUESTIONS 158-1 a. The optimal distribution policy is one that strikes a balance between dividend yield and capital gains so that the firm’s stock price is maximized. b. The dividend irrelevance theory holds that dividend policy has no effect on either the price of a firm’s stock or its cost of capital. The principal proponents of this view are Merton Miller and Franco Modigliani (MM). They
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