Corporations
A business corporation is a legal entity permitted by law in every state to exist for the purpose of engaging in lawful activities of a business nature. It is an artificial person created by law, with many of the same rights and responsibilities possessed by humans. Corporations are widely prevalent in the United States; today, virtually every large enterprise is a corporation.
Rights and Privileges of a Corporation
Within legal guidelines, corporations may issue stock, declare dividends, and provide owners with limited liability.
Stocks A corporation can issue and attempt to sell stock. Every share of stock owned represents a share of the corporation's ownership.
From the standpoint of stock sale, there are two kinds of corporations: public and private. With a public corporation, anyone can buy shares of stock, which may very well be traded on a stock exchange. With a private corporation, however, sale of stock may be limited to stipulated persons, such as members of the principal stockholder's family.
A corporation can own "treasury stock"; that is, it may repurchase its own stock that it had previously issued and sold.
A corporation may even give its stock away for any reason; for example, as a donation to a charity, or as a reward to employees for industrious service.
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