MGMT 20000 Lecture Notes - Lecture 4: Sole Proprietorship, Income Statement

• School: Purdue University
• Department: Management
• Course: MGMT 20000
• Professor: Frank Kane

Document Summary

Operating: transactions that relate to the primary operations of the company. Investing: transactions involving the purchase and sale of resources that provide benefit for several years. Financing: transactions the company has with investors and creditors (for borrowed money) Sole proprietorship: business is owned by one person. Partnership: business is owned by two or more persons. Corporation: business is legally separate from its owners. Income statement: reports revenue and expenses over an interval of time. Asses the company"s ability to earn a profit from running its operations. "statement of operations" is used if a company reports a loss iclicker questions. Owners are not personally responsible for the liabilities of the corporation. Transfer of ownership will not affect the continuity of a corporation. The costs related to rent, utilities, and salaries in the current reporting period are examples of liabilities. The statement provides info about a business" ability to earn a profit and growth.