Asked by Benny Csillag on Jun 15, 2024
Verified
The costs of bringing a corporation into existence,including legal fees and promoter fees,are called:
A) Minimum legal capital.
B) Stock subscriptions.
C) Organization expenses.
D) Selling expenses.
E) Prepaid fees.
Organization Expenses
Costs incurred in the creation of a corporation or partnership, such as legal fees and state filing fees, often amortized over time.
Legal Fees
Payments made to attorneys or law firms for legal services rendered, which may include consultations, representation in litigation, and preparation of legal documents.
Promoter Fees
Fees paid to an individual or company that facilitates the promotion or creation of a business opportunity or event.
- Acquire knowledge of the financial obligations required to form a corporation and regulate its equity.
Verified Answer
BC
Beatriz CastroJun 18, 2024
Final Answer :
C
Explanation :
The costs of bringing a corporation into existence, which may include legal fees, promoter fees, and other expenses incurred during the process of organizing a new corporation, are known as organization expenses. Minimum legal capital refers to the minimum amount of capital required by law to start a corporation, while stock subscriptions refer to the commitments made by investors to purchase shares in the new corporation. Selling expenses and prepaid fees are not typically associated with the process of forming a corporation.
Learning Objectives
- Acquire knowledge of the financial obligations required to form a corporation and regulate its equity.