ACC 522 Chapter Notes - Chapter 1: Canadian Business, Cash Flow
Document Summary
Acc 522 chapter 1 notes: taxation its role in decision making. Business decisions on: are all influenced by their tax treatments: the form of business, raising of capital, wage and salary, and, business acquisitions and divestitures. Business enterprises and individuals are subject to many forms of taxation by municipal, provincial, and federal authorities. Ultimate goal maximization of shareholder wealth decisions that: reduce, or, postpone the payment of tax. Most significant form of taxation affecting roi (return on investment) is income tax at both federal and provincial level. By its nature, it taxes more heavily those enterprises that are more successful in maximizing profits: investor"s roi is measured by the cash flow returned after the payment of all related taxes. Two important principles must be adhered to when applying taxation to financial decision-making: (1) tax should be considered a controllable cost and (2) cash flow exists on an after-tax.
