Erica Sporer Different Entities Mean Different Equity – The Corporate Equity Section Corporations have the most complex equity sections of any business entity, and for C corporations it can get much trickier than for S corporations. Owner’s equity for corporations has more components than other business forms. It starts with the two basic divisions that all companies … Read more
Different Entities Mean Different Equity – Distributing Partnership Profits and Losses Since partnerships don’t pay their own income taxes, being pass-through entities (structures where only the owners pay taxes on the business income, which you’ll learn more about in Chapter 16), any profits or losses have to be divided among the partners. The partners then … Read more
Different Entities Mean Different Equity -Accounting for Partnership Equity The accounting for partnership equity is quite similar to that for a sole proprietorship, but taken one step further. Now you have more than one owner, so you have more than one capital account. All profits and losses must be divided among you and your partners … Read more
Different Entities Mean Different Equity – Accounting for Sole Proprietorships A sole proprietorship has a single owner, making his equity the easiest of all to calculate. For this entity, the basic accounting equation says it all: the assets minus the liabilities equals the owner’s equity (a rearrangement of the classic assets equal liabilities plus equity … Read more
Different Entities Mean Different Equity -Which One Is Best for Your Business? Choosing the best entity for your business is a matter of sifting through your needs and plans. There really isn’t one entity that’s best for all businesses (though some people will tell you there is), and you don’t have to be stuck forever … Read more
Different Entities Mean Different Equity – Meet the Business Entities From the accounting standpoint, you have only to deal with three entities, or forms of business: sole proprietorships, partnerships, and corporations. That’s because even though other forms exist, they share the same accounting structure as one of these three. FACT LLCs, the most common small-business … Read more
Preparing Financial Statements – The Statement of Cash Flows Statements of cash flows are the most complicated reports you’ll prepare. It’s much easier when you have accounting software or an accountant to create the report for you. On the plus side, you can tell whether you’ve done it right based on the ending cash balance, … Read more
Preparing Financial Statements – The Balance Sheet A balance sheet provides a financial snapshot of your business at a frozen point in time. Also known as the statement of financial position, this report will give you a clear picture of where your business stands. The balance sheet contains current pictures of your assets, liabilities, and … Read more
Preparing Financial Statements – The Statement of Profit and Loss The statement of profit and loss is by far the favorite among business owners; after all, this is the one that shows the profits. This statement can show you much more than the bottom line, though. It can let you know if you’ve been setting … Read more
Preparing Financial Statements – How These Statements Interconnect Even though they each contain very distinct information, the three main financial statements are completely connected. In fact, you can’t produce a balance sheet without first creating a statement of profit and loss, and you can’t prepare a statement of cash flows without having already produced the … Read more
