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3 years ago

Give at least one disadvantage of incorporation and explain why it is a disadvantage.

Business

1 answer:

Naya [18.7K]3 years ago

5 0

Answer:

1. Lack of ownership

2. Higher taxation

3. Legalities and formalities

Explanation:

An incorporated company is one that has a separate legal entity from that of its owner and shareholders. Disadvantages of an incorporated company include:

Lack of ownership

An incorporated business is a separate entity from its owner. Hence, separate bank accounts would be required along with separate business identification since personal identification would not be sufficient. At the same time, personal funds must be kept separate from business funds. Mixture of the two is an offense against the law. Also, as shareholders are involved, they may have voting rights, hence, the owner will not have a complete say in all business activities.

Higher taxation

Incorporated companies are expected to pay higher taxes whilst others may have minimum taxable limits. The owner will have to pay income tax as well as corporate taxes. They will also accumulate other expenses such as accounts and legal fees whilst processing these complex taxation methods.

Legalities and formalities

Incorporating a business in itself requires complex procedures and a lot of paperwork. After this has been accomplished, the company is still expected to follow strict codes of conduct such as those provided by the Companies Act. This would include the way borrowings and lending occur, investments, dividend provisions, meetings and audits. They will also have to register documents under the Registrar of Companies.

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A sporting goods manufacturer budgets production of 45,000 pairs of ski boots in the first quarter and 30,000 pairs in the secon

Alexandra [31]

Answer:

The budgeted materials need in kg. in the first quarter is 90,000 kg

Explanation:

For computing the budgeted material needed in the first quarter, first we have to calculate the consumption of first and second quarters separately, so that we can arrive to a solution.

The consumption of first quarter = Budgeted production × required kg

= 45,000 × 2

= 90,000 kg

The consumption of second quarter = Budgeted production × required kg

= 30,000 × 2

= 60,000 kg

The ending raw material inventory = 30% of second quarter

= 30% × 60,000

= 18,000 kg

Now put the formula to find out the purchase amount. The formula is shown below:

Raw material consumption = Opening raw material inventory + purchase of raw material - ending raw material inventory

where,

beginning inventory = 18,000 kg

90,000 = 18,000 + purchase - 18,000

So, the purchase is 90,000 kg

The question has asked the amount in kg so cost per kg is irrelevant.

Hence, the budgeted materials need in kg. in the first quarter is 90,000 kg

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3 years ago

Bachelor’s degrees are typically earned in _____.

WARRIOR [948]

Answer:

A bachelor degree is typically earned between 3 and 4 years. Many schools require students to complete about 40 courses or 120 credit hours.

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2 years ago

Read 2 more answers

Nuxall Confections produces a variety of different candies. Nuxall Confections wants its candies to be available anywhere a cons

sweet [91]

Answer:

Intensive distribution

Explanation:

Intensive distribution -

It is one of the strategy of marketing where the company sells the goods or commodity via as many possible outcomes as possible , so that people can get the product everywhere , is known as the strategy of intensive distribution .

Hence , from the question , the variety of candies produced by the Nuxall Confections are made to be available everywhere possible , to increase the sale .

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3 years ago

When the company pays rent expense for the current month, what is the effect on the accounting equation for that company?

GREYUIT [131]

Answer:

decrease the stockholder equity and decrease in assets

Explanation:

As we know, the accounting equation is

Total assets = Total liabilities + stockholder equity

In the given case,

The rent is paid for the current month, so the journal entry would be

Rent expense A/c Dr XXXXX

To Cash A/c XXXXX

(Being rent is paid)

So it decreases the stockholder equity as it includes the income and expenses part and it decreases in assets as it reduces the cash balance

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3 years ago

Since the costs of producing an intermediate product do not change regardless of whether the intermediate product is sold or pro

Snowcat [4.5K]

Answer: a) true

Explanation:

The costs incurred to produce the intermediate products have already been incurred and as such are referred to as sunk costs.

They will not change regardless of whether the good is sold before further processing or if it is sold after. They therefore do not matter in the decision to either process or sell and so are not considered.

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3 years ago