Accounting201

Partnership

Shared control, tax advantages, increased skills and resources

Sole Proprietorship

Simple to set up, and maintains control with owner

Marketing Managers

Trying to determine whether an advertising proposal will be cost-effective

Creditors

Trying to determine whether the company can pay its obligations

Internal Revenue Service

Trying to determine whether the company compiled with tax laws

Chief Financial Officer

Trying to determine whether the company should employ debt or equity financing

Investors in Common Stock

Trying to determine whether the company's net income will result in a stock price increase

Balance Sheet

Inventory, accounts payable, retained earnings, equipment, common stalk, accounts receivable

Investing Activities

Cash paid to purchase a new office building.

Financing Activities

Cash paid to stockholders (dividends). Cash received from issuing new common stock.

Operating Activities

Cash received from customers. Cash paid to suppliers.

Corporation

Easier to transfer ownership and raise funds, no personal liability

Income Statement

Income tax expense, sales revenue, costs of goods sold, interest expense