SMG FE 101 Final: fe101 final exam study guide
12 Dec 2015
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Chapter 1: corporate finance & the financial manager. Four types of firms: sole proprietorships, partnerships, limited liability companies, corporations. Many new businesses use this organizational form. Principle limitation no separation between firm and owner. Owner has unlimited personal liability for firm"s debts. Life of sole proprietorship limited to life of the owner. More than one owner; all partners liable for firm"s debts. Based off of a legal partnership agreement. Partnership ends on the death/withdrawal of any partner. Limited partnership has two kinds of owners: general partners. Have the same rights and privileges as partners in any general partnership. Are personally liable for the firm"s debt obligations: limited partners. Have limited liability and their ownership interest is transferable. All owners have limited liability, but they can also run the business. Legally defined, artificial being, separate from its owners. Has many legal powers that people have (enter into contracts, acquire assets, etc. )
