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sole proprietorship

simple to establish, owner controlled, tax advantages, Simple to set up and maintains control with founder

partnership

simple to estable, shared control, croader skills and resources, tax advantages, Shared control, tax advantages, increased skills and resources.

corporation

easier to transfer owndership, easier to raise funds, no personal liability, Easier to transfer ownership and raise funds, no personal liability.

internal revenue service

Trying to determine whether the company complied with tax laws.

chief financial officer

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

creditors

Trying to determine whether the company can pay its obligations.

marketing managers

Trying to determine whether a marketing proposal will be cost effective.

investors in common stock

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

income tax expense

income statement

inventories

balance sheet

accounts payable

balance sheets

retained earnings

balance sheets

property, plant, equipment

balance sheets

net sales

income statement

cost of goods sold

income statement

common stock

balance sheets

receivables

balance sheets

interest expense

income statement

basic accounting equation

assets=liabilities + stock holders equity

cash

asset

accoutns receivable

asset

common stock

stockholders equity

notes payable

liability

other assets

assets

other liabilities

liabilities

inventories

assets

income taxes payable

liabilities

property, plant, equipment

assets

retained earnings

stockholders equity

accounts payable

liability

SOX 2002

top management must certify accuracy of financial information, severe penalites for fraud, increased the independence of outside auditors, increased oversight rold of BOD

partnerships and sole propierities

reduced legal liability for investors

balance sheet

presents info at a specific point in time, reports assets, liabilites, and stockholder equity

regularatory authorities

external users

management

internal

taxing authorities

external

present creditors

external

investing section

section of a cash flow statement indicates the cash spent on new equipment during the past accounting period

notes to the financial statement

The element of a corporation's annual report that describes the corporation's accounting methods is the

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