States With No Income Tax Should You Move to One

States With No Income Tax Should You Move to One SAT / ACT Prep Online Guides and Tips While everyone in the US pays a federal income tax, not everyone pays a state income tax. There are seven states in the US with no income tax whatsoever, plus two more that don’t tax wages. While people who live in these states don’t pay income tax, they may pay higher taxes in other ways, like when they go shopping or stop at the gas station. This guide will explore whether or not people in income tax-free states save money overall, along with the pros and cons of moving to one of these states. First, let’s look at the nine states with few or no taxes on income. What Are the States With No Income Tax? There are seven states with no income taxes whatsoever. They are the following: Alaska Florida Nevada South Dakota Texas Washington Wyoming Two other states, New Hampshire and Tennessee, don’t have an income tax on wages, but they do tax interest and dividend income. If you’re making money from investments, for instance, then that profit would be taxed in New Hampshire or Tennessee. The remaining 41 states do level a tax on income. Some have a flat-rate income tax, while others have different brackets based on how much money you make. These states gain revenue from income taxes, and that money goes into various services and programs. In states that don’t collect income tax, where does the revenue come from? There are nine states in the U.S. with no or few state income taxes. Lokal Profil/Wikimedia Where Do States With No Income Tax Get Revenue? States still need revenue, and they get that money from a variety of sources. Commonly, states without income tax have higher sales, gas, and property taxes. They may also provide fewer, more expensive, or lower quality public services. For instance, in-state tuition at the public universities in New Hampshire is higher than that of most other states. Let’s look on a state-by-state basis to see how these no-income-tax states collect revenue. Alaska: petroleum revenue. Because of its oil, Alaska is an exception among income tax-free states. Rather than raising other taxes, Alaska actually distributes a dividend check to residents. Last year, each resident’s share was $2,075. Florida: above average sales taxes and property taxes. Nevada: gambling-related fees and taxes, as well as sales taxes. South Dakota: personal taxes, property taxes, cigarette excises, bank franchises, and ore taxes. Texas: oil and gas royalties, as well as a high sales tax. Washington: some of the highest sales and gasoline taxes in the United States. Wyoming: coal mining and property taxes. Like Alaska, Wyoming also gets revenue from its natural resources. New Hampshire: property tax. Tennessee: highest sales tax in the US. Given these alternative forms of revenue collection, does living in a state without income tax mean you keep more of your paycheck? Alaskan residents actually get money back each year from the Alaska Permanent Fund. Living in Alaska can be expensive, though, as it’s a pretty remote place. Does Living in an Income Tax-Free State Mean You Keep More of Your Money? The short answer to this question is, not necessarily. As you can see above, many states without income tax charge higher taxes on day-to-day expenses. They may also provide fewer public services or more expensive higher education. Depending on your spending habits and lifestyle, the amount of money you’re paying toward other taxes could be higher than the amount you would pay toward taxes overall in a state that had an income tax. How much you benefit from an income tax-free policy also largely depends on your income level. Typically, people with a higher income benefit from the lack of income tax, while people with lower incomes end up paying a larger percentage of their salary to other kinds of taxes. According to the Institute on Taxation and Economic Policy in Washington, for example, the poorest 20% of state residents pay 16.9% of their annual income in sales and gas taxes, while the wealthiest 1% pay just 2.4% of their income. Your income level, therefore, becomes an important factor if you’re deciding whether or not to move to a state with no income tax. What else should you consider as you figure out where to live in the United States? Should you move to sunny Florida, where palm trees are a-plenty but state income tax is nowhere to be found? Who Should Move to an Income Tax-Free State? As you read above, income tax-free states tend to have higher sales, gas, and property taxes and a reduced budget for public programs, like education. If any of the following are true for you, then you might benefit from living in one of these states. If the opposite is true, then you probably shouldn’t move to one. You Have a High Income Higher-income people tend to benefit the most from living in an income tax-free state. Besides keeping a larger proportion of your wages, higher income people may also have less need for public services. For instance, higher-income people may not rely on public education, instead sending their kids to private schools. You Don’t Own Much Property If you don’t own a lot of property, then you won’t get hit too hard with the often high property taxes in income tax-free states. If you do own a lot of property, then living in one of the nine states discussed above probably wouldn’t work in your favor. If you own a lot of land or houses, then you may end up getting hit with high property taxes. You Don’t Spend a Lot Besides having higher property taxes, most of these nine states impose high sales taxes. If you have a high consumption lifestyle, then you’ll be putting a higher than average percentage of your income toward sales taxes. If you don’t spend a lot, then you may save money in one of these states overall. You Don’t Rely on Public Services States without income taxes may offer reduced or lower quality public services, like transportation, health care, or public education. If you don’t have kids or are sending your kids to private school, then this might not affect you. Washington, by the way, is an exception with its strong public school system, but it has some of the highest sales and gas taxes in the country. If you drive a lot in Washington, then you might end up paying a lot in gas tax and highway and bridge tolls. If you’re sending kids to public school, be careful about the quality of the education system in an income tax-free state. You Hold Conservative or Libertarian Views People have different opinions about state income tax, and their support of or opposition to it tends to coincide with their social and political views. People with progressive or liberal views tend to support government funding of public services, like education, health insurance, and transportation, and they tend to be in favor of income taxes, as well. Those with more conservative or libertarian views want to minimize the government’s role in shaping society and consequently, tend to be opposed to income taxes. They may oppose any kind of income redistribution and prefer that all people pay the same on other taxes, like sales taxes. Progressives, however, point out that sales taxes affect people at different incomes disproportionately, with lower income populations becoming the most burdened. People also disagree about whether income taxes help or hinder job and population growth. Those who oppose income tax say that doing away with it boosts jobs and helps the state retain young people. According to a 2013 study, though, Texas was the only non-income tax state where job growth didn’t lag behind population growth. If you find yourself agreeing with the typically conservative or libertarian point of view opposed to state income tax, then you may well enjoy living one of the nine states listed above. Are you a progressive, conservative, or libertarian? Whether or not you support state income taxes tends to align with your social and political views. You’ve Done Your Research Beyond figuring out whether living in an income tax free state would be financially beneficial for you, you should also base your decision on a number of other factors, like the state’s culture and weather and what your moving process would be like. Are you ready to move to Nevada’s desert climate and live close to the temptation of gambling? Does the libertarian bent of many Texans appeal to you? Are you comfortable living in a remote place like Alaska where the sun shines all summer and hides all winter? Any move calls for a good deal of research and planning. If your main motivation is doing away with income tax, then remember that there are other factors to consider, like state services and how the government’s alternative methods of revenue collection affect you as an individual or family. If you do decide to pack up and move to the desert of Nevada or a ranch out in the Lone Star state, what steps do you need to take? Besides bringing lots of water, what steps would you need to take to move to a state with no income tax, like Nevada? How to Move to a State With No Income Tax In order to move and start enjoying an income tax-free life, you’ll typically need to establish both state residency and domicile. Residency and domicile laws vary by state. Typically, you’ll need to spend a certain amount of time in the state, as well as change some records to reflect your new address. One common law states that you can’t spend more than 183 days in any single state beside your new state of residency. That’s not to say you have to spend the remaining 182 days in your new state of residency. For instance, let’s say you’re moving to Texas. You spend 100 days in Texas, 100 days in Massachusetts, and 165 days in California. Since you didn’t spend a collective 183 days in a single state other than Texas, you can still call Texas your state of residency. However, if you had spent 100 days in Texas and the remaining 265 days in California, then you can’t call Texas your state of residency. Again, your time in one other state can’t exceed 183 days. While establishing residency is pretty straightforward, establishing domicile is a bit more vague. Generally, domicile means that your community connections need to be stronger in your new state than your old state. These connections include things like your voter registration, driver’s license, and bank accounts. You also have to indicate that the new state will be your permanent home. Since residency and domicile requirements vary by state, you’ll have to check the exact specifications for Texas, Wyoming, and the rest of the states with no income taxes. Besides rooting out the exact residency laws, make sure to remember these key points about states with no income taxes and how to move to one. One perk of living in a state with no income tax- you can totally skip that page on your tax returns. States With No Income Tax: Final Thoughts While eliminating an income tax might sound like it saves you money, the policy is a little trickier than it sounds. States still need money, so getting rid of an income tax typically means that they impose higher taxes in other areas. The only exception is states that generate revenue from natural resources, like Alaska with its petroleum. Whether living in a state with no income tax will save you money varies by individual. Typically, people who have a high income will benefit, as well as those who don’t rely on public education, drive very much, own a lot of property, or spend much money overall. You’ll have to take a look at your income, lifestyle, and spending habits to determine whether moving would be financially beneficial for you. Because of the U.S.’s unique mix of state and federal laws, you should always look into tax laws when you’re considering moving. If you’re envisioning relocating to another part of the country, then consider the new state’s tax laws and how they’ll affect your personal finances.

Coursework 1 Essay Example | Topics and Well Written Essays - 2000 words

Coursework 1 - Essay Example Graphic Design, which developed in Switzerland in 1950 was aimed at these tasks, and therefore the concept and methodology of the Swiss style soon spread throughout the world. One of the areas where the emerging international style was the most in demand, was the pharmaceutical industry. The largest Swiss companies that manufactured chemicals and drugs (Ciba, Geigy, Hoffmann-La Roche, Sandoz) to establish a modern corporate style appealed to the leading masters of graphic design - A. Hofmann, C. Gerstner, N. Rudin, J. Hemburgeru, J . Mà ¼ller-Brockmann and others. In Zurich in 1950-s. the most prominent graphic designer was Josef Muller-Brockmann, who has chosen a new  «anonymous » style. A graduate of the Zurich School of Art and Industry, since 1936 he worked as a freelance graphic designer. One of the most brilliant pages in the the career was the creation of posters on the musical program of the Concert Hall (Zurich Tonhalle, 1950 - 1972) and the Opera House of Zurich (Opernhaus Zurich, 1960.). (Bringhust, 2004) To create a visual image of the placards Muller-Brockmann used cascades of crescent shape, the cycle of arcs, the modulation wave-like lines. By the beginning of 1960 the concert posters by Muller-Brockmann become extremely font. The intervals in words, taking the advantage of color and scale, sought to master rhythmic architectonic unity. Typographic composition, the formation of the principle of crossword, stepped lines, or in several columns, represented typical examples of functional typography . Strict and clear style of these years was the culmination of mathematical principles in graphic design. (Hollis, 2006) By the middle of 1960 the usual practice of Swiss graphic designers is the use of modular grid. The book by J. Muller-Brockmann  «Challenges of graphic artist in the field of design engineering » (Gestaltungsprobleme des Grafikers, 1961) first presented the

How does McDonald's alter its marketing mix between countries a case Essay

How does McDonald's alter its marketing mix between countries a case study of UK and China - Essay Example erm – the performance of marketing strategies is usually depended on the resources available – funds, employees and technology (Luo et al., 2005, 50); however, it is also depended on the cultural and social characteristics and ethics of the targeted market. Through the decades it has been proved that no all firms are able to work internationally; in fact, only those firms that have been able to align their strategies with the ethics and the culture of the targeted market have managed to survive in the specific market – entering a foreign market is not the most difficult part of a relevant marketing scheme (Palich et al., 111999, 587). Another issue is the fact that firms that have been established in countries with totally different social ethics and traditions are less likely to understand – at least on time – the psychology and the needs of consumers in a market with particular culture and ethics (Nakata et al., 2001, 255). Organizational culture is proved at this case to have a decisive role in the ability of a firm to develop the strategies that will be effectively implemented in the targeted market (Armstrong et al., 2009, 34); in this context, marketing schemes that are going to be used for the promotion of p roducts/ services in a foreign market will be going to be successful only if they respond to the characteristics and the needs of local people (Hennig et al., 2002, 230); otherwise they will soon be led to a failure. Current paper focuses on the examination of the ways that McDonalds has altered its marketing mix in order to respond to the needs of two different markets: the British and the Chinese. The identification and the evaluation of the relevant policies is based on two different criteria: the views that have been published in the literature – in relation with the study’s main issue – and the views of consumers in the above two countries. In this context, a detailed literature review has been developed in regard to the structure

Implementing Network and Personnel Security Measures Research Paper

Implementing Network and Personnel Security Measures - Research Paper Example In relation to the present network security manufacturing industry, Cisco and IBM can be considered as the leading corporations which provide safe and steady internet environment within the networks of the different global institutions. Cisco Cisco is generally known as one of the inclusive manufacturers in terms of producing a range of effective network security devices. A few of the major Cisco devices include Cisco Threat Defense Solution, Network Admission Control Appliance and Cisco Secure Access Control System among others (Cisco, 2013). The associated costs of the Cisco network security devices vary in accordance with the functions and network structure of the institutions. In general, the network security devices offered by Cisco are cost effective and can be procured from Cisco distributors, dealers along with other retail stores (Cisco, 2013). IBM The network security devices offered by IBM are highly effective for averting, detecting and eliminating different network relat ed vulnerabilities that emerge while designing and deploying network management applications. The devices offered by the company ensure adequate security of the internal information and prevent the access of unauthorized guest users. A few of the major network security products of IBM include ‘IBM Security Key Lifecycle Manager for z/OS’, ‘IBM Security Access Manager for Enterprise Single Sign-On’ and ‘IBM Security AppScan Enterprise’ among others (IBM, 2013). The IBM internet security devices can be procured from the company’s own distribution networks. The network security products offered by the company are relatively more cost effective than other products offered by the different vendors (IBM, 2013). Functionality of Cisco Devices for Governmental Agency Source: (Cisco, 2013) Functionalities of IBM Network Security Devices for Governmental Agency Source: (IBM, 2013) 3. Maintenance Plan for the Government Agency to Ensure Having the Latest Security Measures The maintenance plan concerning the installation of advanced network security devices is one of the essential steps for the government agency to uphold the security of its vital information. Therefore, the maintenance plan of the network security devices within the government agency would be primarily focused on five major practices. The following are the primary activities of the maintenance plan for the government agency to ensure having the latest security measures: Monitoring performance of the network security devices as per their expected outcomes Ensuring better alignment of network security devices with the primary objectives of the government agency Confirming appropriate development of the network security devices installed within the agency Continuous minimization of the network down-time and, Minimizing IT related costs of the government agency Source: (Torstensson, 2010) a. Risks Associated with not fulfilling the Activities Outlined within the Maintenance Plan The improper or unstructured maintenance plan of the network security devices can generate various types of risks for the government agency. A few of the major risks associated with not fulfilling of activities of maintenance plan include: Increase vulnerability from the access of unauthorized guest users Weaken data protection capabilities of the network security devices Misrepresentation of information Increase in agency’

Poststructuralism Paper Essay Example for Free

Poststructuralism Paper Essay What is post-structuralism? How did come about and who started it? How can it be used as a strategy? It cannot be defined without a reference to Ferdinand de Saussere.   He is considered as the â€Å"creator of the modern theory of structuralism (UXL Encyclopedia of World Biography, 2003, p.1).†Ã‚   He was responsible for what was said to have started the entire post-structuralist movement, A Course in General Linguistics.   He did not actually write it; his students, Charles Bally and Albert Sechehaye simply compiled and edited it for publication (UXL Encyclopedia of World Biography, 2003, p.1). Saussere considers language as a â€Å"system of signs that evolves constantly, in which particular words hold no meaning (UXL Encyclopedia of World Biography, 2003, p.2).† Words do not have definition on their own; they need to be involved in a kind of structure wherein together with other words, they begin to make sense.   Moreover, he believes that every idea or object has a sign (UXL Encyclopedia of World Biography, 2003, p.2.), which in turn, has two other parts.   A sign has a signifier, which refers to what a word originally looks or sounds like, while the signified refers to what is represented.   The connection of the two is unpredictable; it is always fluctuating.   This premise is basically the foundation of what is known as post-structuralism.   Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   Post-structuralism actually started in the 1960s in France (James, n.d., p.1).   It is considered both as a critical theory (Henderson and Brown, 1997, p.1), and an interdisciplinary movement (Jones, n.d., p.1) which includes other fields as well like the â€Å"deconstruction of Jacques Derrida, the late criticism of Roland Barthes, and the psychoanalytic revisionism of Jacques Lacan (Henderson and Brown, 1997, p.1)† just to name a few.   Post-structuralism has been discussed alongside postmodernism, but Peters (1999) was quick to differentiate the two: â€Å"Poststructuralism takes as it theoretical object structuralism, whereas postmodernism takes as its theoretical object modernism(p.1). The key word in determining its definition is structure.   Post-structuralism develops a new body of knowledge apart from the pre-established structures.   It claims that the formation of knowledge then may no longer hold now.   There is no such thing as an established truth; what was considered true then, might be dubious now.   Peters (1999) adds, â€Å"Poststructuralism, then, can be interpreted as a specifically philosophical response to the alleged scientific status of structuralism to its status as a mega-paradigm for the social sciences and as a movement which, under the inspiration of Friedrich Nietzsche, Martin Heidegger, and others, sought to decenter the structures, systematicity and scientific status of structuralism, to critique its underlying metaphysics and to extend it a number of different directions, while at the same time preserving central elements of structuralism’s critique of the humanist subject (p.1).† One of the people famous for their contribution in post-structuralism is Frenchman Michel Foucault.   Although he is considered as a philosopher, his work is not confined to a particular body of knowledge.   Throughout his career, his works covered a range of topics, which included â€Å"sexuality, madness, illness and knowledge (UXL Newsmakers, 2005, p.1).†Ã‚   He is also associated with new historicism, which Henderson and Brown (1997) considers as â€Å"history as a species of narrative with gaps or ruptures between epistemes modes of thought and ways of knowing that characterize a given historical moment (p.1).†    He is not interested with history per se; rather, he is more interested in how events become part of history and what made it possible for them to be part of history.   Needham (1995) writes, â€Å"he believes that human nature, instinct, and other intrinsic underpinnings of mankind are not fixed; humans are conditioned through discourse: how we talk, how we formulate knowledge, and who we look to for knowledge. No universal certainties exist; justice, sexuality, insanity, morality all knowledge is a construction of discourse (p.1).†Ã‚   Overall, Foucault forces us to think out of the box.   For him there is no such thing as truth; the structure which developed our notion of truth should be analyzed. Because there is no one stable structure that holds, all that we know is influx all the time and it is better to focus on how these ideas are formed rather than being preoccupied with the ideas themselves.   Because of his post-structuralist ideals, many feminists are turning to him to further their cause.   His ideals help them challenge what was then regarded as true about women in patriarchal discourses.   One of the women who have been regarded for her feminist efforts is Mary McLeod Bethune.   Unlike Foucault, she is not an intellectual.   Smith (1996) calls her â€Å"essentially an activist (p.1),† and rightfully so. Her works is not even limited to women, though she pushes for their opportunities to.   All her life she has fought for the rights of her fellow African-Americans, and released the literary work My Last Will and Testament which is one of the most influential African-American literature out there.   She dared to push the envelope for her race, and defied the odds to help her race â€Å"maintain racial dignity (Smith, 1996, p.105).†Ã‚   S he made sure African-American girls can also be educated like their fair-skinned counterparts.   She opened a school for girls in 1904, which became the Bethune-Cookman College (Smith, 1996, p.106).   At first glance, she may not seem to be a post-structuralist, but she is.   Instead of conforming to the existing structures available to her race that operate in society, she tried to create new possibilities.   That is a move that is post-structuralist, indeed.   Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   Post-structuralism as a strategy is simple; all that needs to be done is to challenge the existing premises by trying to get to the root of the very same premises.   In a post-structuralist sense, the normative condition is taken as such, but not considered stable or fixed.   It is like one of the possible scenarios, not the only one.   In essence, post-structuralism defines the possibility of many other structures, any of which are neither true or false.   From the examples established by Michel Foucault and Mary McLeod Bethune, one must not be satisfied with what is out there.   There should always be a need to ask important questions and look for other solutions.   The status quo is no longer; the possibilities are endless. References Henderson, G. E., Brown, C. (1997). Glossary of Literary Theory. University of Toronto English Library. Jones, R. (n.d). Post-structuralism. Retrieved November 16, 2007, from www.philosopher.org.uk/poststr.htm. Needham, A. (1995). Foucaltphobia-philosopher Michel Foucault. Whole Earth Review, n.v.,1. Peters, M. (1999). Post-structuralism and education. Retrieved November 16, 2007, from www.ffst.hr/ENCYCLOPAEDIA/poststructuralism.htm. Smith, E. M. (1996). Mary McLeod Bethune’s â€Å"Last Will and Testament:† A Legacy for Race Vindication. The Journal of Negro History, 81 (1/4), 105-122. UXL Encyclopedia of World Biography (2003). UXL Newsmakers (2005).

Stress In The Workplace Essay example -- Workplace Health and Safety

Stress by definition is an interaction between individuals and any source of demand (stressor) within their environment. Employment can be an exciting challenge for many individuals; it can also be a tremendous source of stress. (Long, Bonita C.) Stress in the work place can cause many individuals harm emotionally and physically. Several reasons for the intense amounts of stress are; too many demands from co-workers, supervisors constantly breathing down your back, elevated noise levels in the work place, lack of knowledge for a particular position, co-workers not upholding their responsibility to help with the task at hand, and favoritism. Lack of promotional opportunities at your place of employment, in spite of the fact that you go that extra mile will contribute to stress.   Ã‚  Ã‚  Ã‚  Ã‚   Some effects that can result from stress in the work place are; poor job performance, low morale in the office, and insalubrious employees. Reciprocally, elevated stress levels in an organization are associated with increased turnover, absenteeism; sickness, and reduced productivity. At a personal level, work stressors are related to depression, anxiety, general mental distress symptoms, heart disease, ulcers, and chronic pain (Sauter, Hurrell, & Cooper, 1989).   Ã‚  Ã‚  Ã‚  Ã‚  A stressor is the object or event that the individual perceives to be disruptive. Stress results from the perception that the demands exceed one's capacity to cope. (Wiersm...

Four Types Of Financial Statements Essay

Financial Statements come in four basic types; income statement, retained earnings, the statement of cash flow and the balance sheet. These statements are used both internally and externally to calculate the profitability and liabilities of a company. The financial statements of a company are the window for managers, investors, and creditors into the stability of a company. The details of a financial statement differ from the type of the statement and are used by different entities to determine if they want to invest in the company, lend to the company or by managers to determine if the company is operating and the needed level to continue growing. The income statement is a snapshot for a defined time that lists revenues and expenses to equal the net income of the company. Revenues are broken down into sales and other sales. Expenses are items such as cost of goods sold, selling marketing administrative costs, and total income tax. The income statement reports on the success or failure of the company’s operations by reporting its revenues and expenses. If the company’s revenues exceed its expenses, it will report net income; otherwise it will report a net loss (Kimmel & Kieso, 2009). The income statement reports of the company’s operations are profitable or not. The income statements reports how successful the company is at generating a profit at sales. Retained earnings statements are statements of shareholders in dividends and earnings paid to owners. This statement shows the earnings kept by the owners to ensure future growth. High-growth companies generally do not pay dividends and reinvest into the company. This statement shows amounts and cause of change during a period in time. The beginning of the statement shows retained earnings and adds net income and deductions for dividends. The balance sheet is the third type of financial statement that show claims  to assets over a certain period of time. The balance sheet brakes down the short -term and long- term assets of the company. The balance sheets groups similar assets with similar liabilities. Current assets are listed first, long-term investments nets and fixed assets, along with intangible assets like patents. Current liabilities payable in less than a year such as notes payable, accounts payable, salaries payable, unearned revenue, and interest payable are listed first. These are followed by mortgage notes due in more than one year and other notes due in more than a year. Last listed are stockholders equities such as common stock, and retained earnings. Companies list assets in order for which they expect to convert to cash (Kimmel & Kieso, 2009). The last type of basic financial statement is the statement of cash flow. This statement discloses cash receipts and cash payments made to the company for a specific period of time. The statement of cash flow reports the operating, investing, and financial activities of the company. This statement will answer questions such as where did the money come from, how as the money used, and what was the change that happened? Negative numbers are reflected with brackets (). Additionally, these statements report the net increase or decrease in cash during a period in time and the amount of cash at the end of said time. Many entities use financial statement, both inside, and outside the company. Managers can use the balance sheet to determine if the cash on hand is sufficient for immediate cash needs. They can also use these statements to look at the relationship between debts and stockholders’ equity to determine if the company has satisfactory proportion of debt and common stock financing (Kimmel & Kieso, 2009). Creditors can use the financial statements to determine the likely hood of being repaid. The statements will tell the creditors if there are sufficient assets to sell to repay a debt. Using ratio analysis, revenues- expenses= net income, the creditor can measure the success of a company for a given period. Long- term investors and creditors look at the solvency of a company; that is the measurement of long- term survival of the company. Investors use financial statements to determine if they should invest in the company or cash out the stocks they hold, because  of losses in the c ompany. Publicly traded companies must release annual reports, including financial statements, manager’s discussion and analysis, notes to the financial statements and an independent auditors report. Investors use all of these items to ensure they are making a sound investment. References Kimmel, P. D., Weygandt, J. J., & Kieso, D. E. (2009). Financial accounting: Tools for business decision making (5th ed.). Hoboken, NJ: John Wiley & Sons.