Question

xavier and ciara form a corporation to provide cleaning services to local businesses. after two years of trying to make a go of the business, the profits they had hoped for are just not there. xavier and ciara decide to dissolve the corporation and go their separate ways. to terminate the corporate entity, xavier and ciara must:

Answer 1

To dissolve their corporation, Xavier and Ciara must settle debts, liquidate assets, and file dissolution documents with the state. This process ensures all legal and financial obligations are addressed. Inadequate profits are a common reason for businesses ceasing to exist.

Step-by-step explanation:

To dissolve a corporation like the cleaning service business operated by Xavier and Ciara, they must go through a formal process of closing the business. This typically includes settling debts, liquidating assets, distributing any remaining assets to shareholders, and filing the necessary dissolution documents with the state where the corporation was formed. This process is critical to ensure that all legal and financial obligations are properly addressed, and the corporate entity is formally terminated in the eyes of the law. Businesses often cease to exist due to inadequate profits, which are essential for operational continuity and return on investment for the entrepreneurs and shareholders involved.