Question

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Choose at least two concepts from the following: partnership, corporation, liquidation, bankruptcy 7, bankruptcy 11, reorganization, trust, estates, consolidation, parent company, subsidiary, and acquisition.

Required:
Explain how you may use them in your present or future accounting position. Make sure you provide details to include how each concept will help you support the financial goals of the company you currently work for or will work for in the future.

Answer 1

The  two concepts are partnership and corporation.

Partnership:

Partnership may be used in the present and future of the accouting position in the following ways:

Two or more persons forming a legal relationship for doing business jointly together or any one of them doing it on behalf of the remaining persons is said to be partnership. Partnership enjoys a good accounting position compared to the status of individual. Partnership may have more goodwill because of the combination of multiple individuals.It may be less attractive for the society in the initial stage for the business to grow but the developed partnership will fetch good accounting position in the future.

It supports the financial goals of the firm in the following ways:

It allows the partners of the partnership firm to share the individual resources and skills for the mutual benefit. Combined capital is more and can be invested in diversified fields for better returns.Partnership will have high borrowing capacity which allows the business to borrow funds from various sources with cheaper interests. All these helps the firm to meet its financial goals.

Corporation:

Corporation may be used in the present and future of the accouting position in the following ways:

An organization registed under particular law as a seperate entity with common seal and perpetual existence is said to be corporation and it will have good recognition in the society. It may cost more expensive to register and the legal requirements initially but the legal recognition as a corporation will allow it to establish in a high scale to borrow funds from public and many other benefits to enhance the business further in the future.  

It supports the financial goals of the company in the following ways:

The corporation status allows the company to go for public borrowing by registering the share market. It can increase its market value by its performance in the long run. Thus the financial goal of the company can be achieved. The best examples of the corporations acheived financial goals are amazon inc., apple inc.and microsoft etc.