ACC 212 Lecture Notes - Lecture 4: Profit Margin, Net Income, Asset
Document Summary
Business: all of the activities necessary to provide the members of an economic system with goods and services. Business entities: an organization operated to earn a profit. There are 3 types of business entities: sole proprietorships: a form of organization with a single owner. Economic entity concept: the assumption that a single, identifiable unit must be accounted for in all situations. (ex. Assume that bernie berg owns a neighborhood grocery store. In paying monthly bills such as utilities and supplies, bernie must separate his personal costs from the costs associated with the grocery business. To start a corporation, articles of incorporation must be filed with the state. If the articles are approved by the state, a corporate charter is issued and the corporation can begin to issue stock. Share of stock: a certificate that acts as evidence of ownership in a corporation. Advantages of running a business as a corporation:
