Business Entities: Corporations Vs. Partnerships. The Business

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Business Entities: Corporations vs. Partnerships The business entities of corporations and partnerships share many similarities, however key difference exist, primarily in terms of formation, taxes and liability. This section will largely address the issue of liability, in terms of the effects of damages, disclosure requirements and personal liability for both corporations and partnerships. Additionally Amazon will be examined as a partnership rather than a corporation to further illustrate these differences.
Damages Estimate
According to the FASB, guidance on contingent liabilities applies to all entities, therefore corporations and partnerships should approach damage estimates similarly. FASB specifies that contingencies be measured at
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While requirements for reporting debt estimates and other contingent liabilities remain the same for corporations and partnerships, the implications of damage are far more severe for partnerships.
Disclosure Requirements Publicly traded companies are subject to the reporting and disclosure requirements of the Securities Exchange Commission (SEC). The laws that govern the securities industry were established to provide transparency to investors, creditors and shareholders alike. According to Hoyle, Schaefer & Doupnik, (2015) there are seven major disclosure requirements, the first being a five-year summary of operations to encompass sales, assets, income from continuing operations. Followed by a description of business activities, a three year summary of industry segments to include foreign and domestic operations, a list of company directors and executives, quarterly market price of common stock for the last two years, restrictions on the company’s ability to continue paying dividends, and finally, an analysis of the company’s financial condition, changes in the conditions and results of operation.
In contrast, private entities such as partnerships and companies with less than $10 million in assets and under 500

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