Ray is a shareholder of a small company. When the director falls to undertake an action it falls under derivative suit.
Explanation:
- Derivative suit is referred to as a law suit that is brought by the shareholder in behalf of the company against the third party.
- If in a company the employees, the directors as well as the officers are not ready to file a complain against the third party then the shareholder has the right to file a complaint against the third party.
- Derivative suit is normally filed by the shareholder when there is a mismanagement in the company. To stop the illegal work this action is being taken.
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Answer: In managing a political risk, the first thing to do is to go on a research, to determine the type of political risk that is likely to occurs in the country or state, and the level of influence this risk has on your business. If the risk is manageable, then investment can start, but before start, you should get a political risk insurance certificate, from a national insurance body or an international insurance body. If at a time the risk becomes higher, that it is likely to affect the production of my profit. The business will be incorporated with a government owned business. So as to sustain the business profit, because no Government will want to establish any law that will have big negative effect upon its own business. If the high risk is as a result of the host community, then the business should be incorporated with the community, so that their will see a sense of belonging to the business.
Explanation:
The political risk found in managing any business are the influences government policies have on that business, this includes taxes,spending,regulation,currency valuation,trade tariffs, minimum wage and environmental regulation.
Explanation:
The journal entries are shown below:
On October 12
Purchases ($47,500 x 0.99) $47,025
To Account Payable $47,025
(Being the purchase of merchandise is recorded)
On October 12
Freight In $670
To Cash $670
(Being the freight charges is recorded)
On October 31
Account Payable $47,025
To Interest Expense $475
To Cash $47,500
(Being the payment for purchases is recorded)
Account Receivable $31,400
to Sales Revenue $31,400
(To record the sales on account)
On October 31
Cost of Goods Sold $20,550
Ending Inventory $59,145
To Beginning Inventory $32,000
To Purchases $47,025
To Freight In $670
(Being recording the adjusting entry is made)
