Philippine Business Orgs: Pros & Cons of Nestle Corp., Exercises of Management Accounting

Download Philippine Business Orgs: Pros & Cons of Nestle Corp. and more Exercises Management Accounting in PDF only on Docsity! Activity # 1 – Forms of Business Org. 1. Give one (1) example of successful business establishments that represents any of the four forms of business organization in the Philippines.  Nestle Philippines - Corporation 2. In relation to your answer in number 1. Research the other possible advantages and disadvantages of the chosen form of organization. (Give at least 3 advantages and 3 disadvantages) explain briefly. Advantages:  Limited liability - A corporation's shareholders are only responsible for the value of their contributions. The company agency protects them from all additional responsibility, because they are protected by their own properties.  Access to capital - Because most businesses sell ownership of publicly traded securities, through the sale of stock, they can quickly collect funds. This access to finance is a privilege that most forms of organizations do not have. Not only is it great for developing a company, but also for preventing a company from going bankrupt in times of need.  Business security and perpetuity - Corporation ownership is based on a proportion of equity ownership that provides far greater stability in terms of transfer of ownership and long-term perpetuation of the company than most forms of organization. While the exact specifics of the transition of ownership in the bylaws and articles of incorporation depend on the governing agreement, ownership of this form of company is always easy to purchase and sell. Disadvantages:  Excessive tax filings - The different forms of income and other taxes that must be collected will include a significant amount of documentation, depending on the form of company. As noted earlier, the S company is the exception to this situation.  Double taxation - It will pay taxes on its revenue, based on the form of company, after which owners pay taxes on any dividends earned, meaning that income can be taxed twice.