Chapter 1, Problem 1Q

The proprietary theory, the entity theory, and the funds theory are three approaches to accounting for equities.   Required: a. Describe briefly each of these theories b. State your reasons for emphasizing the application of one of these theories to each of the following:       i.  Single proprietorship       ii. Partnership       iii.  Financial institutions (banks)       iv.  Consolidated statements       v.  Estate accounting

A limited partner will: a. Manage the firm b. Discount the bills c. Invest capital only in the firm d. Conduct meeting

Q: Compare the characteristics of organizational and legal forms of enterprises: Criteria The organizational and legal form Individual entrepreneur Economic partnership (LLC) Economic society (JSC) Simplicity of the creation       Control over the activities                   Liability of the owners           Investment Liquidity*       Period of existence

multiple choice  The officer responsible for the firm's financial activities such as financial planning and fund raising, making capital expenditure decisions, and managing cash, credit, the pension fund, and foreign exchange is(a)​Treasurer.(b)​Controller.(c)​Foreign exchange manager.           (d)​None of the above.

A partner is to a partnership like a(n) ______________ is to a corporation   a. Officer b. Director c. Shareholder d. Manager

________ is a separate entity and in that capacity can borrow from banks, bondholders, preferred stockholders, and common shareholders. A.        limited partnership B.         sole proprietorship C.         government organization D. public company

Compare owner’s equity in a sole proprietorship, partners’ equity in a partnership,and stockholders’ equity in a corporation.

1. For the risk-return principle implies that the riskier a given course of action, the higherthe expected return must be. (T) (F)2. General partners have unrestricted transferability of ownership, while limited partnersmust have the consent of all partners to transfer their ownership. (T) (F)3. Owners must register and pay yearly fees to their State of residence when establishinga sole proprietorship. (T) (F)4. The purpose of financial markets is to bring borrowers and savers together. (T) (F)5. In Financial markets, borrowers and lenders most both be located in the same country. (T) (F)6. Beginning cash balance + cash flow from operations + cash flow from investingactivities + cash flow from financing activities = ending cash balance. (T) (F)7. On a common size balance sheet, total assets are equal to 100%. (T) (F)8. The income statement shows a company's earnings since it has been in business. (T) (F)9. The balance includes information about the company's assets and liabilities. (T)…

Question based on the picture attached. (a) Explain any three (3) differences between maximising profits and maximising shareholders’ wealth. Justify which one should be the goal of a company. (b) Explain any three (3) costs and benefits of partnerships/proprietorships as compared to corporation. Give your opinion which type of organizational structure is preferable.