Financial Accounting

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Sole Proprietorship

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it is simple to set up and gives you control over the business
i.e. barber shops , law offices , auto repair shops etc.

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Partnership

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When you join forces with other individuals to form a partnership. A business owned by 2 or more persons associated as partners. Partnerships are often are formed because 1 individual does not have enough economic resources to initiate or expand the business.

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Corporation

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A business organized as a separate legal entity owned by stockholders. Also individuals can become stockholders by investing relatively small amounts of money therefore it is easier for corporations to raise funds.

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Taxes and Legal liability

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If you choose a sole proprietorship or partnership , you generally receive more favorable tax treatment than a corporation . However proprietors and partners are personally liable for all debts of the business ; corporate stockholders are not. In other words corporate stockholders generally pay higher taxes but have no personal liability

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Accounting

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the information system that identifies, records , and communicates the economic events of an organization to interested users. Users of accounting information can be divided broadly into two groups: internal users and external users

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Internal Users

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Internal users of accounting information are managers who plan , organize , and run a business. These include marketing managers , production supervisors , finance directors , and company officers.

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External Users

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investors (owners) use accounting information to make decisions to buy, hold , or sell stock. Creditors such as suppliers and bankers use accounting information to evaluate the risks of selling on credit or lending money

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Tax Authorities

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Such as the internal revenue service want to know whether the company complies with tax laws