Intro To Business Chpt 5

Front 1

proxy

Back 1

document authorizing another person to vote on behalf of a shareholder in a corp

Front 2

board of directors

Back 2

group of people, elected by the shareholders, who have the ultimate authority in guiding the affairs of a corp

Front 3

3 groups that govern a corp

Back 3

shareholders elect board of directors who appoint officers who hire employees

Front 4

what are the 3 most common forms of business ownership

Back 4

1. sole proprietorship
2. partnership
3. corporation

Front 5

unlimited liability

Back 5

any damage or debts attributable to the business can also be attached to the owner because the two have no separate legal existence

Front 6

general partnership

Back 6

all partners have the right to participate as co-owner & are individually liable for the business's debts

Front 7

limited partnership

Back 7

one or more general partners.
one or more of the partners whose liabiltiy is attached to the amount of their capital investment

Front 8

partnership

Back 8

unincorporated business owned & operated by 2 or more persons under a voluntary legal association

Front 9

partnership agreement

Back 9

written document stating all the terms of operating the partnership by spelling out the partners' rights and responsibilities.

Front 10

corporation

Back 10

legally chartered enterprise having most of the legal rights of a person, including the right to conduct business, to own and sell property, to borrow money, and to sue or be sued;
owners of the corporation enjoy limited liability

Front 11

shareholders

Back 11

owners of a corporation

Front 12

stock certificate

Back 12

document that proves stock ownership

Front 13

common stock

Back 13

shares whose owners have voting rights and have the last claim on distributed profits and assets

Front 14

dividends

Back 14

distribution of corporate assets to shareholders in the form of cash or other assets

Front 15

preferred stock

Back 15

shares that give their owners first claim on a company's dividends and assets after all debts have been paid and whose owners do not have voting rights

Front 16

private corporation

Back 16

company owned by private individuals or companies

Front 17

public corporation

Back 17

corporation that actively sells stock on the open market

Front 18

liquidity

Back 18

the level of ease with which an asset can be converted to cash

Front 19

S corporation (subchapter S corporation)

Back 19

corps with no more than 75 shareholders that may be taxed as a partnership;

Front 20

limited liability companies (LLCs)

Back 20

organizations that combine the benefits of S corporations and limted partnerships without the drawbacks of either

Front 21

subsidary corporations

Back 21

corps whose stock is owner entirely or almost entirely by another corp

Front 22

parent company

Back 22

company that owns most, or all, of anothers company stock and that takes an active part in managing that other company

Front 23

holding company

Back 23

company that owns most, or all, of another company's stock but that does not actively participate in the management of that other company

Front 24

chief executive officer (CEO)

Back 24

person appointed by a corp's board of directors to carry out the board's policies and supervise the activities of the corporation

Front 25

merger

Back 25

combination of two companies in which one purchases the other, assuming control of all property and liabilities

Front 26

consolidation

Back 26

combination of two or more companies in which the old companies cease to exist and a new enterprise is created

Front 27

acquisition

Back 27

form of buisness combination in which one company buys another company's voting stock

Front 28

horizontal mergers

Back 28

combinations of companies that are direct competitors in the same industry

Front 29

vertical mergers

Back 29

combinations of companies that participate in different phases of the same industry (materials, production, distribution)

Front 30

conglomerate mergers

Back 30

combinations of companies that are in unrelated businesses, designed to augment a company's growth and to diversity risk

Front 31

leveraged buyout (LBO)

Back 31

situation in which individuals or a group of investors purchase a company primarily with debt secured by the company's assets

Front 32

hostile takeover

Back 32

situation in which an outside party buys enough stock in a corporation to take control against the wishes of the board of directors and corporate officers

Front 33

4 defenses against unwanted takeovers

Back 33

1. the poison pill
2. golden parachute
3. shark repellant
4. white knight