Business 100
Accountants are in a position to provide advice to business owners to determine which organization structure is best for their particular business venture. Imagine that you were approached by a friend or relative interested in starting a specialty business to design men and women clothing. Discuss the advantages and disadvantages of at least two (2) forms of business structures. Make a recommendation regarding the structure your friend or relative should use based on this particular venture. Explain your rationale.
Based on your recommendation regarding the appropriate business structure, explain the major advantages and disadvantages of the business owner with minimal accounting experience maintaining the company's books instead of hiring an accountant. Discuss the major impact to the users of accounting statements if the statements are prepared in error. Provide support for your position.
The first business structure that I would recommend, would be a partnership I would inform them that general partnerships consist of two or more partners who are both responsible for the business. They share the assets and profits, as well as the liabilities and management responsibilities for running the business. Some benefits of general partnerships is their simplicity and flexibility. General partnerships are usually less expensive to form and require less paperwork and formalities than corporations, limited partnerships or limited liability partnerships. General partnerships can choose a centralized management structure, like a corporation, or a completely decentralized structure, where every partner is actively involved in the management of the business. Other advantages of a general partnership are that the partners can combine resources and share the financial commitment. Some disadvantages to general partnerships, principally liability. General partners are personally liable for the business debts and liabilities. Each partner is also liable
Based on your recommendation regarding the appropriate business structure, explain the major advantages and disadvantages of the business owner with minimal accounting experience maintaining the company's books instead of hiring an accountant. Discuss the major impact to the users of accounting statements if the statements are prepared in error. Provide support for your position.
The first business structure that I would recommend, would be a partnership I would inform them that general partnerships consist of two or more partners who are both responsible for the business. They share the assets and profits, as well as the liabilities and management responsibilities for running the business. Some benefits of general partnerships is their simplicity and flexibility. General partnerships are usually less expensive to form and require less paperwork and formalities than corporations, limited partnerships or limited liability partnerships. General partnerships can choose a centralized management structure, like a corporation, or a completely decentralized structure, where every partner is actively involved in the management of the business. Other advantages of a general partnership are that the partners can combine resources and share the financial commitment. Some disadvantages to general partnerships, principally liability. General partners are personally liable for the business debts and liabilities. Each partner is also liable