Question

What are some factors to consider when deciding to create a corporation?

Please referance too.

Answer 1

Solution:

There are various factors to be considered while creating a corporation. Some of main factors are as under:

Control : At the time of creating corporation, you have to consider what level of control you wish to have on your business.

Capital financing: You have to consider what are major sources of funding like equity, debt etc. You have to consider how much debt equity ratio you want to maintain.

Tax implication: You have to consider tax implication on corporation and other types of entities.

Types of business: You have to consider what type of business you want to do while creating corporation. Like you want to be a manufacturing concern, trading concern or in service sector etc.

Cost and complexity of formation: The different business structure is having differing set up procedures, cost and complexities involved. Therefore cost and complexity in business of a corporation to be considered.