Accounting 20

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Accounting 20

• Partnerships and Corporations
• Definitions

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Partnership

• A business that is owned and managed by two or
  more individuals who receive all the profits and
  bear all the losses

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Partnerships Have

• UNLIMITED LIABILITY
• All partners are personally held responsible for
  all debts incurred by the partnership

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Partnerships Have

• MUTUAL AGENCY
• When one partner has the right to make decisions
  without consulting the other partner(s)

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Partnerships Have

• PARTNERSHIP ACTS
• Documentation that outlines the legal obligations
  of the partnership

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Partnerships may Have

• LIMITED PARTNERS
• Partners who do not have unlimited liability
  they are not personally liable for debts incurred
  by the partnership

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Corporation

• A business that is owned by stockholders and has
  rights and responsibilities as if it were a
  person
• Incorporation the process of forming a new
  corporation

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Corporations Have

• SHARES
• Portions of ownership in a corporation

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Corporations Have

• SHAREHOLDERS
• Own shares for the corporation and are entitled
  to a portion of the profits and the right to vote
  in decision making within the corporation.

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Corporations Have

• LIMITED LIABILITY
• A shareholders personal responsibility for the
  corporations debts is limited to that persons
  investment in the company

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Corporations Have

• BOARD OF DIRECTORS
• A group of people elected by shareholders that
  establish corporate policies and make management
  decisions for the corporation

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Corporations Have

• CORPORATION ACT
• A collection of laws in each province that govern
  corporations

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Corporations Have

• DIVIDENDS
• The portion of a corporations earnings that is
  distributed to its shareholders usually paid
  quarterly

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Corporations Have

• RETAINED EARNINGS
• The portion of the net income that is kept by the
  corporation rather than distributed to its
  shareholders as dividends

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Corporations Have

• SHAREHOLDERS EQUITY
• The corporations net worth total assets minus
  total liabilities