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Author Question: What is the difference between a type S corporation and a limited liability company? What will be ... (Read 127 times)

nautica902

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What is the difference between a type S corporation and a limited liability company?
 
  What will be an ideal response?

Question 2

What is a divisional organization and what are its advantages and disadvantages?
 
  What will be an ideal response?



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ultraflyy23

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Answer to Question 1

A type S corporation is a special type of corporation in which profits are taxed at the personal tax rates of each individual stockholder. A limited liability company is owned by two or more owners, and the owners' liability is limited to their investments. The profits are taxed at the personal tax rates of individual owners.

Answer to Question 2

A divisional organization uses an organizational breakdown consisting of multi-function divisions. The advantages of the structure are: focuses on products, customers, and markets; recognizes interdepartmental interdependencies; fosters cohesion; ensures accountability; allows diversification; increases strategic and operational control; and allows sharing of resources across functional areas. Disadvantages are: inefficient use of resources, limits career advancement within functional areas, and may lead to dysfunctional competition among divisions.





 

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