Answered: What choices are available to a group…

What choices are available to a group of persons creating a business? Why is it possible that a partnership is not the optimal company structure? What additional possibilities do they have

Principles of Accounting Volume 1

19th Edition

ISBN:9781947172685

Author:OpenStax

Publisher:OpenStax

Chapter15: Partnership Accounting

Section: Chapter Questions

Problem 3MC: Which of the following is a disadvantage of the partnership form of organization? A. limited life B....

See similar textbooks

Related questions

Q: How important is intercompany activity on decisions to form business combinations? We see…

A: Business Combination: Any transaction or other event in which an acquirer (an investment entity)…

Q: What accounting steps are taken by a partnership firm when a new partner is unable to bring the…

A: When a new partner is not able to bring the business guaranteed by him, then the guaranteed amount…

Q: 1) why would you choose an LLC form over partnership or an S-corporation? 2) what role should social…

A: As per our guidelines we are supposed to answer only one question (if there are multiple questions…

Q: How does partnership accounting differ from corporate accounting?

A: Accounting: Accounting is a system, or a process of collecting and organizing economic transactions,…

Q: What are the main drawbacks of adopting the stakeholder approach as the basis for setting the…

A: A business or an organisation is run to achieve the objectives set for the organisation. The…

Q: The concept of an "artificial being" refers to which form of business organization? a. Partnership *

A: Business generally means a state of making a person engaged for earning livelihood. Artificial in…

Q: What does it mean to be a company? Instead of forming a partnership, why would the founders of the…

A: The Answer:

Q: A major issue faced by people who are starting their own business is the form of organization they…

A: The company's goal is to maximize profits. Profits are derived from the company's income statement.…

Q: What drives a person to establish their own company, and what are the benefits of doing so

A: In business, the word "sole proprietorship" refers to a person responsible for establishing their…

Q: partnership. What fundamentals of partnership agreement are necessary in the business? Also…

A: 1. What is Partnership? A partnership can be defined as a formal arrangement by two or more…

Q: conflicts that can arise when a company is owned by group of shareholders but managed by a different…

A: The shareholders are owners of the business. As per agency theory, the management act as agents on…

Q: ify the strengths and weaknesses of sole proprietorship, partnership, and corporation? What type of…

Q: What is the Use of Corporate General Partners?

A: In a partnership, two or more parties agree to operate and manage a business and share the profits…

Q: Agency problems would be less likely to exist in a: sole proprietorship. partnership.…

A: Solution: Agency problems would be less likely to exist in a "Sole proprietorship" because there is…

Q: Based on the advantages and disadvantages of each of the following forms of businesses, give an…

A: A business is formed by the persons who want to start the business and as there are various methods…

Q: What are some of the legal risks associated with organizing a business as a partnership? In your…

A: SOLUTION- PARTNERSHIP- IT IS A KIND OF BUSINESS WHERE A FORMAL AGREEMENT BETWEEN TWO OR MORE PERSONS…

Q: a) What is an advantage that the owner of a sole proprietorship has over the owners of partnerships?…

A: As per the guidelines, only one question is allowed to be solved. Please upload different questions…

Q: Briefly describe about partnership. What fundamentals of partnership agreement are necessary in the…

A: The Indian Partnership Act, 1932 defines Partnership in the following terms: “ Partnership is the…

Q: d ho

A: Agency relationship : An agency connection can be understood as the fiduciary relationship in which…

Q: Is it possible for a person to form a joint venture with a business? What's your theory about that?

A: Will be explained:

Q: A capitalist partner is not allowed to enter into a new partnership if it is a competing business.…

A: Diligence – The obligation of the partner is to act diligently in her decisions on behalf of the…

Q: Discuss the advantages and disadvantages of forming a partnership as opposed to a sole proprietor.

A: In partnership there are 2 or more persons working as a partners and sharing profit or loss among…

Q: What is the possible agency conflict between inside owner/managers andoutside shareholders?

A: Agency conflict: The conflict of interest of two parties one which is the principal and other which…

Q: Which type of business organization requires huge amount of capital? a. Joint venture b. Corporation…

A: Company means a form of business where the share holder invest money in business in form of shares…

Q: Which business vehicle (corporation or partnership) would you choose to start a firm and why

A: The Answer

Q: One advantage of switching from a partnership to the corporate form of organization is the…

A: It makes it easier for the firm to raise additional capital

Q: In small business some activities are outsourced and some resources are acquired externally, that is…

A: THERE ARE EFFORTS OF VARIOUS PEOPLE IN ORDER TO RUN A SUCCESSFUL BUSINESS MANY PEOPLE ASSOCIATED…

Q: In application there are few general partnerships and commandite companies? Explain the reason.

Q: What type of Partnership as a business formation would be best suited for a "Silent Partner"…

A: General Partnership- This is the kind of partnership where two or more agrees to run a business. In…

Q: Define and differentiate between sole trader and partnership business with full explanation I need a…

A: A business is an organization entirely made for earning profits and fulfilling social…

Q: Is merging better for a business than being acquired? Provide examples and references to support…

A: The process of merging or acquiring both are the ways of consolidating assets or companies. Under…

Q: Choose the correct. Which of the following is not a reason for the popularity of partnerships as a…

A: Partnership: This is the form of business entity which is formed by an agreement, owned and managed…

Q: What options does a group of people have when forming a business? Why might a partnership not be the…

A: Options will a bunch of individuals have once formed a business : 1. Partnership 2. Body corporates…

Q: Which one of the following situation a partnership firm will have goodwill? a. The firm is earning a…

A: A goodwill is a company's reputation measured in monetary terms.

Q: Justify how the stock ownership regulations affect partners and professional personnel

A: A Certified Public Accountant (CPA) performs an audit engagement, which permits an auditor to…

Q: Q: Compare the characteristics of organizational and legal forms of enterprises: Criteria The…

A: Meaning of LLC: - Limited liability companies (LLC) are referred to as entities with corporate…

Q: An advantage of the partnership as a form of business organization would be

A: There are several forms of business organisation. These are sole proprietorship, partnership and…

Q: Which business vehicle(Company or partnership) you will adopt if you are to set up a business and…

A: Partnership: A partnership is a commercial enterprise that is possessed by two or more persons who…

Q: How did Ahmed and Steven Case's partnership and shared vision of "Rise of the Rest" serve their…

Q: fine agency relationship. Briefly describe agency problems, agency costs and incentives do managers…

A: Agency relationship is very common problem in organization type of structure and very prominent…

Q: Even though, from an accounting standpoint, partnerships are separate entities from the partners,…

A: Partnership Firm: A Partnership firm may be defined as a group of two or more people who have…

Q: A significant difficulty that entrepreneurs encounter is determining the kind of organization to…

A: The firm's goal is to make the company more profitable. The company's income statement may be used…

Question

What choices are available to a group of persons creating a business? Why is it possible that a partnership is not the optimal company structure? What additional possibilities do they have?

Definition Definition Arrangement between two or more people whereby they agree to manage business operations and share its profits and losses in an agreed ratio. The agreement drafted and signed by the partners of the firm is termed as a partnership deed and contains various important clauses agreed between the partners such as profit/loss sharing, interest on capital, remuneration allocation of each partner, and drawings of a partner.

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

SEE SOLUTION Check out a sample Q&A here

Step 1

VIEW

Step 2

VIEW

Step 3

VIEW

Step by step

Solved in 3 steps

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.

Similar questions

Which of the following is a disadvantage of the partnership form of organization? A. limited life B. no taxation at the partnership level C. flexibility in business operations D. combining of financial resources
What options does a group of people have when forming a business? Why might a partnership not be the best form of business organization? What other options might they have?
A major issue faced by people who are starting their own business is the form of organization they should select. What are some major characteristics of a partnership that might influence their decision?
A significant difficulty that entrepreneurs encounter is determining the kind of organization to create. What are some significant aspects of a partnership that might sway their decision?
Which form of business organization is characterized by having the shortest start-up time and lowest legal costs? Select one: a. partnership b. S-corporation c. proprietorship d. corporation
How does running a company as a partnership as opposed to a corporation benefit the parties involved? What are the drawbacks of this approach?
What are the advantages of operating a business as a partnership rather than as a corporation? What are the disadvantages?
Explain the advantages and disadvantages of the partnership versus the corporate form of business.
What are the main advantages of a company compared to a sole trader and a partnership?
What are some of the legal risks associated with organizing a business as a partnership? In your opinion, would you want to enter into a partnership? Under what circumstances? Explain.
The owner of an accounting practice is considering establishing a partnership with two other persons to carry on the business. What are the major disadvantages of a partnership form that she should consider in making her decision?
Highlight differences between partnership and limited company?