Business Administration 2257 Chapter Notes - Chapter 1: International Financial Reporting Standards, Legal Personality, Financial Statement
30 Dec 2013
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Chapter 1: the purpose and use of financial statements. Internal users of accounting information plan, organize, and run companies. Investors, lenders, and other creditors are considered to be the primary or key external users of accounting information. Proprietorship is a business owned by one person. Unlimited liability the owner receives any profits, suffers any losses, and is personally liable for all debts of the business. Partnership is a business owned by more than one person. They are formed because one person doesn"t have enough economic resources to initiate or expand the business. Corporation is a business organized as a separate legal entity owned by shareholders. Shareholders enjoy limited liability since they only risk losing the amount they have invested in the company"s shares. Public corporations distribute their financial statements to investors, lenders, other creditors, other interested parties and the general public.
