Textbook Notes (369,205)
Canada (162,462)
Business (358)
BUSI 1003 (12)
Chapter 1

Chapter 1

3 Pages

Course Code
BUSI 1003
Patti Proulx

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Chapter 1 – Roles ofAccounting in Business Business – Aorganization where resources such as material and labour are used to provide goods or services to customers Types of Business – Service business – Provide services rather than products such as repairs ● Manufacturing business – Change resources into products that are sold ● and merchandising business – Sell products that they purchase from other busi. Forms of Business ● Proprietorship – 1 owner of the business ● Partnership – More than one owner ● Corporation – Many owners of a company, shares (Part owner of the company) ● Have to share financial statements ● Organized under state or federal statues as a separate legal entity ● Dividends – Share profits with shareholders (amount per stock) Considering Choice of Form of Business ● Ease of Formation – ex. Harder to form a corporation then partnership ● Ability to raise capitol – ex. Corporations raise capitol through selling stocks ● Legal Liability ● Taxation – Proprietorship and partnership business' owners are taxed individually. Corporations have to pay Corporation Income Tax ● Limitation on Life Form Ease of Legal Liability Taxation Limitation on Access to Formation Life of EntityCapitol Proprietorship Simple No limitation Nontaxable Yes Limited Entity Partnership Simple No limitation Nontaxable Yes Average Entity Corporation Complex Limited Taxable Entity No Extensive Liability Stakeholder – a person or entity with an interest in the economic performance an well being of a company Decision Making and Business Stakeholders ● Capitol Market Stakeholders – Shareholders, markets and bank ● Providers of major financing for the business. Provide money to start business and continue operations ● Interested in profits and if they can pay back ● Product or Service Market Stakeholders – Customers and suppliers (don't want busi. to close) ● Buyers of products or services, want continued success, warranty ● Government Stakeholders – CRA, Corporations Canada, Ontario Ministry of Government Serv. ● Collect taxes and fees from the company and it's employees
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