GB550M1_Assignment.docx(1) GB550-M1 Financial Management Practices Case Study Purdue University Global a. Why is corporate finance important to all managers? Corporate finance is important because it
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GB550M1_Assignment.docx(1) GB550-M1 Financial Management Practices Case Study Purdue University Global a. Why is corporate finance important to all managers? Corporate finance is important because it shows managers how to identify and select strategies to add value to businesses and helps forecast funding requirements and strategies to acquire the funds. Corporate finance refers to how businesses earn and spend money, therefore any decision that requires the use of money directly or indirectly relates to all managers (Merritt, 2019). b. Describe the organizational forms a company might have as it evolves from a start-up to a major corporation. List the advantages and disadvantages of each form. When an entrepreneur begins the journey of owning a business there are three forms they can explore- a sole proprietorship, assuming all the liability but reaping all the rewards, a partnership, sharing the liabilities and the rewards with another, and a corporation, sharing the liabilities and rewards with many. There are advantages and disadvantages to each (Merritt, 2017). 1. Sole Proprietorship- Advantages of a sole proprietorship are that its easy to form, there are few regulations and no corporate income taxes. The disadvantages of a sole proprietorship is the unlimited liability on your own assets and the difficulty in raising capital to support the business. 2. Partnership- The advantages and disadvantages of a partnership are almost identical as a sole proprietor. . . . . .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. . .. .. . . . . . . . . . . . . . . . . . .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
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