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You are Paul/Paula Augustus, accountant to Jake Richards and work for the Richards' Tree Farm Company. Read this case study Richards' Tree Farm Grows Up

  1. You are Paul/Paula Augustus, accountant to Jake Richards and work for the Richards' Tree Farm Company. Read this case study "Richards' Tree Farm Grows Up" in the textbook.
  2. Should the Richards form a regular corporation or choose one of the hybrid forms? Select a form for them because they intend to distribute ownership equally among Jake, his wife, and their two children so that each party will own 25% of the shares. Give your reasons for the type of corporation you selected.
  3. Consider the tax consequences of their decision and outline the advantages and disadvantages (if any) of this decision.
  4. Jake occasionally hires day workers, who may or may not be in the United States legally. Jake's farm is in Massachusetts. What are his legal and ethical obligations with respect to this decision?
  5. Suppose the Richards' Tree Farm has an opportunity to become much larger as the housing market heats up. How might it obtain more equity funding and perhaps create considerable wealth for the Richards family in the process? What do you advise?
  6. Outline and define in detail the concept of the cycle of money. Describe the participants in the cycle of money and explain the objectives of a financial transaction.
  7. list and describe the following three types of decisions an organization might make: (a) capital budgeting decision, (b) a capital structure decisions, and (c) a working capital management decision
  8. Go on the Internet to the SEC site named EDGAR (for the Electronic Data Gathering Analysis and Retrieval System). This site provides free access to reports and provides an online tutorial for new viewers. www.sec.gov/edgar.shtml.

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