Chapter 1 Concept Questions: Sole Proprietorships and Partnerships [LO3] What are the four primary disadvantages of the sole proprietorship and partnership forms of business organization? What benefits are there to these types of business organization as opposed to the corporate form? Corporations [LO3] What is the primary disadvantage of the corporate form of organization?
As used in this chapter: A "Person" includes individuals, receivers, assignees, trustees in bankruptcy, estates, firms, partnerships, associations, joint-stock companies, joint ventures, clubs, societies, corporations, the state and its political subdivisions, and combinations of individuals of any form.
B "Sale" and "selling" include all of the following transactions for a consideration in any manner, whether absolutely or conditionally, whether for a price or rental, in money or by exchange, and by any means whatsoever: Notwithstanding any other provision of this chapter, such transactions that occur between members of an affiliated group are not sales.
An "affiliated group" means two or more persons related in such a way that one person owns or controls the business operation of another member of the group. In the case of corporations with stock, one corporation owns or controls another if it owns more than fifty per cent of the other corporation's common stock with voting rights.
As used in this division, "personal care service" includes skin care, the application of cosmetics, manicuring, pedicuring, hair removal, tattooing, body piercing, tanning, massage, and other similar services. As used in this division, "motor vehicle towing service" means the towing or conveyance of a wrecked, disabled, or illegally parked motor vehicle.
As used in this division, "snow removal service" means the removal of snow by any mechanized means, but does not include the providing of such service by a person that has less than five thousand dollars in sales of such service during the calendar year.
Except as provided in section The construction contractor is the consumer of such tangible personal property, provided that the sale and installation of carpeting, the sale and installation of agricultural land tile, the sale and erection or installation of portable grain bins, or the provision of landscaping and lawn care service and the transfer of property as part of such service is never a construction contract.
As used in division B 5 of this section: The term does not include such materials when they are or are to be incorporated into a drainage system appurtenant to a building or structure even if the building or structure is used or to be used in such production.
Beginning with the first day of the month following that notification, the transactions described in division B 11 a of this section are not sales for the purposes of this chapter or Chapter The tax commissioner shall order that the collection of taxes under sections Except as provided in this section, "sale" and "selling" do not include transfers of interest in leased property where the original lessee and the terms of the original lease agreement remain unchanged, or professional, insurance, or personal service transactions that involve the transfer of tangible personal property as an inconsequential element, for which no separate charges are made.
C "Vendor" means the person providing the service or by whom the transfer effected or license given by a sale is or is to be made or given and, for sales described in division B 3 i of this section, the telecommunications service vendor that provides the nine hundred telephone service; if two or more persons are engaged in business at the same place of business under a single trade name in which all collections on account of sales by each are made, such persons shall constitute a single vendor.
Physicians, dentists, hospitals, and veterinarians who are engaged in selling tangible personal property as received from others, such as eyeglasses, mouthwashes, dentifrices, or similar articles, are vendors. Veterinarians who are engaged in transferring to others for a consideration drugs, the dispensing of which does not require an order of a licensed veterinarian or physician under federal law, are vendors.
D 1 "Consumer" means the person for whom the service is provided, to whom the transfer effected or license given by a sale is or is to be made or given, to whom the service described in division B 3 f or i of this section is charged, or to whom the admission is granted.
In addition to being consumers of drugs administered by them or by their assistants according to their direction, veterinarians also are consumers of drugs that under federal law may be dispensed only by or upon the order of a licensed veterinarian or physician, when transferred by them to others for a consideration to provide treatment to animals as directed by the veterinarian.
The purchase of such property and services is not subject to the exception for resale under division E of this section. That person is not entitled to claim exemption under division B 42 f of section The purchase of that property is not subject to the resale exception under division E of this section.
The purchase of such services by a medicaid health insuring corporation is not subject to the exception for resale under division E of this section or to the exemptions provided under divisions B 121819and 22 of section E "Retail sale" and "sales at retail" include all sales, except those in which the purpose of the consumer is to resell the thing transferred or benefit of the service provided, by a person engaging in business, in the form in which the same is, or is to be, received by the person.
F "Business" includes any activity engaged in by any person with the object of gain, benefit, or advantage, either direct or indirect. G "Engaging in business" means commencing, conducting, or continuing in business, and liquidating a business when the liquidator thereof holds itself out to the public as conducting such business.
Making a casual sale is not engaging in business. As used in this division, "delivery charges" means charges by the vendor for preparation and delivery to a location designated by the consumer of tangible personal property or a service, including transportation, shipping, postage, handling, crating, and packing.
A preferred customer card that is available to any patron does not constitute membership in such a group or organization. For the purpose of this division, the tax imposed under Chapter For the purposes of this division, a gift card is not sold by a vendor or purchased by a consumer if it is distributed pursuant to an awards, loyalty, or promotional program.
Past and present purchases of tangible personal property or services by the consumer shall not be treated as consideration exchanged for a gift card. As used in this division, "watercraft" includes an outdrive unit attached to the watercraft. I "Receipts" means the total amount of the prices of the sales of vendors, provided that the dollar value of gift cards distributed pursuant to an awards, loyalty, or promotional program, and cash discounts allowed and taken on sales at the time they are consummated are not included, minus any amount deducted as a bad debt pursuant to section J "Place of business" means any location at which a person engages in business.
K "Premises" includes any real property or portion thereof upon which any person engages in selling tangible personal property at retail or making retail sales and also includes any real property or portion thereof designated for, or devoted to, use in conjunction with the business engaged in by such person.
L "Casual sale" means a sale of an item of tangible personal property that was obtained by the person making the sale, through purchase or otherwise, for the person's own use and was previously subject to any state's taxing jurisdiction on its sale or use, and includes such items acquired for the seller's use that are sold by an auctioneer employed directly by the person for such purpose, provided the location of such sales is not the auctioneer's permanent place of business.
As used in this division, "permanent place of business" includes any location where such auctioneer has conducted more than two auctions during the year.
M "Hotel" means every establishment kept, used, maintained, advertised, or held out to the public to be a place where sleeping accommodations are offered to guests, in which five or more rooms are used for the accommodation of such guests, whether the rooms are in one or several structures, except as otherwise provided in division G of section N "Transient guests" means persons occupying a room or rooms for sleeping accommodations for less than thirty consecutive days.
O "Making retail sales" means the effecting of transactions wherein one party is obligated to pay the price and the other party is obligated to provide a service or to transfer title to or possession of the item sold.
P "Used directly in the rendition of a public utility service" means that property that is to be incorporated into and will become a part of the consumer's production, transmission, transportation, or distribution system and that retains its classification as tangible personal property after such incorporation; fuel or power used in the production, transmission, transportation, or distribution system; and tangible personal property used in the repair and maintenance of the production, transmission, transportation, or distribution system, including only such motor vehicles as are specially designed and equipped for such use.Describe the process whereby the owners control the firm’s management.
What is the main reason that an agency relationship exists in the corporate form of organization? In this context, what kinds of problems can arise? Describe process whereby the owners control the firm's management.
Rocket Lawyer is committed to making the law simpler, more affordable, and available to everyone. In the spirit of this goal, we've created the Plain Language Legal Dictionary.
May 28, · Describe the process whereby the owners control the firm's management. The stockholders essentially are the owners of the corporation.
In a large corporation, the stockholders and the managers are usually separate groups. Describe the process whereby the owners control the firm's management.
What is the main reason that an agency relationship exists in the corporate form of organization? In this context, what kinds of problems can arise? Control of the corporate (firm) ultimately rests with stockholders.
They elect the board of directors, who, in turn, hire and fire management. The fact that stockholders control the corporation.