PRINCIPAL CHARACTERISTICS OF A CORPORATION

a)Entity Status--a corporation is a legal entity created under the authority of legislature b)Limited Liability--as a legal entity, a corp is responsible for its own debts; its sh’s liability is limited to their investment; c)Free Transferability of Interest--shares, representing ownership interests, are freely transferable; d)Centralized Management and Control--a corp’s management is centralized in a board of dirs and officers. Shs have no direct control over the board’s activities; e)Duration--Continuity of Existence--a corp is capable of perpetual existence; f)Taxation--a corp, as an entity, pays taxes on its own income; shs are taxed only on dividends; g)Remember Attributes of the Corporation--CLIFF: 1)Centralization of management; 2)Limited liability; 3)Forever (perpetual duration); 4)Freely alienable (shares can be sold).