StudentShare
Contact Us
Sign In / Sign Up for FREE
Search
Go to advanced search...
Free
Premium+

Corporation and All Other Organizational Forms - Essay Example

Cite this document
Summary
This is the "Corporation and All Other Organizational Forms" essay. It is essential to look at the distinctive aspects that brand each entity to justify and understand more concerning a corporation…
Download full paper File format: .doc, available for editing
GRAB THE BEST PAPER92.6% of users find it useful

Extract of sample "Corporation and All Other Organizational Forms"

Corporation and All Other Organizational Forms Essay

It is essential to look at the distinctive aspects that brand each entity to justify and understand more concerning a corporation. Below are some fundamental questions that are answered precisely.

What’s the notable dissimilarity concerning a corporation and all other organization forms? A corporation is a legal object distinct from its owner. Therefore, the owners are not accountable for the tasks that the corporation comes into.

What’s the meaning of the limited expression liability in the trade setting? Limited liability means that the owners or stakeholders are exclusively liable for the amounts spent in an establishment. However, they are not accountable for debts, collections suffered by a company, or delinquent funds. Other legislative forms such as corporations, which serve as styletextalign, give their owners limited liability while limited firms provide limited liability to limited associates and not all associates.

However, things may not always be styletextalign because there are both benefits and shortcomings of setting a firm as a corporation, and you have to justify each case. The core benefit is that they offer limited liability to the owners.

They also enjoy greater liquidity and an elongated life for the unlimited number of potential owners investing funds in the establishment. So, it is always essential for one to discuss his or her knowledge and get the correct advice for the venture that brings more income. The main detriment is paying taxes twice from the dividend and the discrete amid tenure and leading of the corporation.

Besides, you must be knowledgeable about the duties you are needed to attain to assist you in justifying a particular firm and categorize it in the right group. It also aids you to grow the revenue from the corporation. There is an S and C corporation. The main difference is that C Corporation pays income taxes on profits, after which they distribute revenue among the owners. The proprietors are also responsible for paying income taxes on the remunerations.

On the other hand, S corporation does not pay corporate taxes on profits. It is styletextalign because they pass the liability onto the owners. Besides, the S corporation is limited to no more than one hundred U.S citizens.

Styletextalign Examples to Understated More About C and S Corporations

You are a stakeholder in a C corporation. The corporation receives $2 per share afore taxes. After it has paid the taxes, it allocates the rest of the revenue to you as a dividend. The corporate tax rate is 40%, and the personal taxes rate 3% for both dividend and non- dividend income. How much do you remain with after paying all levies?

Dividend open after corporate taxes: $ 2 X (1-0.4) =1.20. Dividend after personal taxes: 1.20 X (1-0.3)=$ 0.84 after all taxes are cleared. So, $0.84 per share is accessible for sharing.

When we take the same styletextalign case with an S corporation, the outcome is different. Dividend obtainable after corporate taxes: S establishment is exempted from corporate taxes. Dividend accessible for individuals taxes: 2 X (1-0.3) = $1.40 is available after all duties are cleared. Therefore, $ 1.40 per stake is presented for distribution.

Another styletextalign example is: at the beginning of 20219, SP had a book value of equity $105 billion, 10.5 bn share outstanding and 10.80 market price. SP also had cash of $48 billion and a debt of $ 524 billion. After three years at the beginning of 2012, SP had a book value of $116 billion, the outstanding share of 10.6 billion with $ 17 per share market price, cash of $ 84 billion and total debt of $410 billion.

Over the duration, what was the SP’s shift in market value? The styletextalign calculation is: market value of equity=shares outstanding X market price per piece in 2009: $ 10.5 bn share X 10.80 per share= $113.4 billion. In 2012, 10.6bn portion X $ 17 per share=180.2 billion.

Therefore, the total adjustment in market capitalization between 2009 and 2012 is $ 10.2 billion - $113.4 billion= 66.8 billion.

Another styletextalign example of the same case is to calculate the Market-to-book ratio.

2009: $113.4/ $105=$1.08 and in 2012, $ 180.2/$ 116=1.55. Therefore, the shift in the market to book ratio between 2009 and 2012 is 1.55-1.08= 0.47.

Styletextalign calculation for enterprise value= market value of equity +debt- cash 2009: $113.4 +$ 524-$ 48= $ 589.4 billion. In 2012: $180.2 + $410- $84 = 506.2 billion, it makes the change in enterprise value between 2009 and 2012 to be: $ 506.2 -$ 589.4=-$ 83.2 billion.

Assume that in 2013, Global launces an antagonistic market crusade that increases sales by 15%. Nonetheless, their action margin cascades from 5.57% to 4.50%. Assume that they do not have another income, interest expenditures are unaffected, and taxes are the same quantity of pre-tax income as in 2012. Justify the Global’s EBIT in 2013.

Styletextalign 2013 revenue: $186.7M X 1.15= $214.705M where we justify EBIT to be $214.705M X0.045=$ 9.66M.

In the above styletextalign case, justify Global’s net revenue in 2013. Net income= EBIT – INTEREST EXPENSES – TAXES. So, the net income in 2013 is ($ 9.66M-$ 7.7m) X (1-026) = 1.45M.

With a styletextalign situation, Justify if Global’s P/E ratio and several shares unsettled remains and justify the share price in 2013. In the year 2012 bit price divided by earning per share= $14/$0.556=25.17 and in 2013, EPS net revenue/shares unsettled= $1.45M/3.6M shares=$0.403. Share price=25.17 X $0.403= $10.14 per bit.

These styletextalign cases enable you to know more about companies. With the right examples, you can justify any case through accurate calculations. So, as a stakeholder, you can see the amount in shares to be distributed as long as you know the domain of your company.

As seen, S and C, you can quickly decide the corporation to invest in your finances. With these examples, we are confident you can justify any claim regarding liability or an investment. Read extensively and follow standards you can emulate to justify challenging calculations. The best thing is as long as you know the concept, everything else will be easy.

Read More
Cite this document
  • APA
  • MLA
  • CHICAGO
(Corporation and All Other Organizational Forms Essay, n.d.)
Corporation and All Other Organizational Forms Essay. https://studentshare.org/business/2089074-corporation-and-all-other-organizational-forms-premium-essay
(Corporation and All Other Organizational Forms Essay)
Corporation and All Other Organizational Forms Essay. https://studentshare.org/business/2089074-corporation-and-all-other-organizational-forms-premium-essay.
“Corporation and All Other Organizational Forms Essay”. https://studentshare.org/business/2089074-corporation-and-all-other-organizational-forms-premium-essay.
  • Cited: 0 times

CHECK THESE SAMPLES OF Corporation and All Other Organizational Forms

Forms of Business Organization

This paper 'forms of Business Organization" focuses on the fact that a sole proprietorship is an unincorporated form of business, which is owned and managed by a single entrepreneur.... Advantages It is easy and less expensive to form compared to other forms of business organizations such as C-corporations and LLC.... A single person will own, operate, carry out all business activities as well as transactions single-handedly.... This means that the business owner will be personally liable for all the business debs and risks and as their personal belongings will be confiscated to settle the claims of the creditors....
12 Pages (3000 words) Term Paper

Forms of Business Organization

The author of this assignment "forms of Business Organization" touches upon the business organization that, in the modern era, can be identified to face the challenge of expansion towards gaining competitive advantages.... hellip; The report will describe six major business forms by considering the advantages and disadvantages on the basis of the above aspects.... A sole proprietorship is considered the easiest form of organizational structure....
8 Pages (2000 words) Assignment

Bryant Park: A Design for the Crowd

Wrangles arose amongst the people about the ownership of the park and if Bryant Park could accommodate all the activities and in addition serve as a place of leisure.... Bryant Park corporation (Name) (Institution) (Course) (Date) A Design for the Crowd Bryant Park is a 9....
7 Pages (1750 words) Research Paper

Accounting and Its Relationship to Business

Literature Review forms of Business Name of of University Literature Review: forms of Business Accounting and its Relationship to Business Accounting is the study of numbers and financial matters that have to do with business.... There are many different forms of accounting and they all take care of business in some way.... Because of this, an accountant must understand the different forms of business so they are able to provide the best information for the particular business....
8 Pages (2000 words) Essay

Baby Bottle Tooth Decay

Leading on from the first advantage, acquisition ensures that the buyer enjoys a ready-made organizational structure, system and culture.... In business, there is no denying the fact that establishing an organization may not be as difficult as establishing or setting up a organizational structure, system or culture.... Gourley notes that “organizational culture is defined as the shared values, norms and expectations that govern the way people approach their work and interact with each other....
4 Pages (1000 words) Research Paper

Major Issue of OMV Petrom

The corporation should check and evaluate the performance of the organizational change and whether the corporation and the employees can meet the objectives.... Therefore, it is difficult to change the cultural management of a corporation because there will be need to implement new organizational cultures.... Additionally, another theme that is evident is the method used to transform corporations into sustainable organizations based on organizational change....
2 Pages (500 words) Essay

Change of Organizational Culture Case

These were all standard tools including detailed forms for organizational quarterly performance evaluations.... onovan introduced a new performance management system lessening more than 150 employee forms to just three one page electronic documents.... The present paper describes a particular case study regarding the change of organizational culture.... Thus, the essay will analyze the steps that the team took to make the change, and explain what the whole change was about and why it is considered so successful… The article is one of the best examples of organizational cultural change in business history....
4 Pages (1000 words) Essay

A System of Motivation and Incentives by Federal Express Corporation

These incentives come in different forms such as (1) attractive compensation package; (2) specialized forms of recognition; (3) financial or non-financial incentives; (3) stock option plans; and (5) fringe benefits, to name a few.... The effectiveness of the incentive plans implemented by Federal Express Corporation in relation to the attainment of organizational goals would be evaluated in this paper.... The choice of objectives and the formulation of strategic policies for the attainment of organizational goals depend on a variety of factors unique to a The paper “Effectiveness of Incentive Plans Implemented by Federal Express Corporation for Attainment of organizational Goals" is a brilliant version of a case study on management....
3 Pages (750 words) Term Paper
sponsored ads
We use cookies to create the best experience for you. Keep on browsing if you are OK with that, or find out how to manage cookies.
Contact Us