They typically use this method because it requires fewer journal entries for closing an accounting period and creating financial statements. I feel this method only gives the owner or company a view on the cash coming in and out but does not give the company a long term view on the overhead cost and revenue for services in order to show the company where improvements can be made or where costs
In a regular partnership, liability for other partners' misdeeds is limited to the amount of a particular partner's investment in the business. b. Attracting large amounts of capital is more difficult for partnerships than for corporations because of such factors as unlimited liability, the need to reorganize when a partner dies, and the illiquidity (difficulty
CHAPTER 17 CAPITAL STRUCTURE: LIMITS TO THE USE OF DEBT 2. The statement is incorrect. If a firm has debt, it might be advantageous to stockholders for the firm to undertake risky projects, even those with negative net present values. This incentive results from the fact that most of the risk of failure is borne by bondholders. Therefore, value is transferred from the bondholders to the shareholders by undertaking risky projects, even if the projects have negative NPVs.
Accrual basis accounting records the transaction immediately in a type of account, such as accounts payable, money owed to other companies for services; or accounts receivable “money owed by its debtors” ("Google.com", 2012). Later when the business pays out or is paid; they perform a balance by debiting one account and balancing by credit the corresponding and opposite account. Tracking the relationship between purchase and sale easier, something cash basis accounting fails at. In general, accrual basis accounting is preferred at tax time and for medium to large business. The classic example is expense.
The principles of stare decisis (binding law from higher courts) are the same as for the Federal Court. Appeals from the Family Court are heard by a "Full Court" of the Family Court (three to five judges). Appeals from the Full Court lie to the High Court of Australia, though special leave is required. A single judge of the Family Court may hear appeals in family law matters from the Federal Magistrates Court of Australia. Appeals from the Federal Magistrates Court must go to either of these courts (Federal Court or Family Court), dependent on the area of
There are alot of reason why I choose accounting major ,but maybe the cliche reason are that because I like doing mathematic things and I am expert in mathematics subject . After I heard about how successful my father’s friend who is chief financial officer in big company, I started have different opinion about accounting major . Th first reason is accounting is different from the other social science . In my opinion alot of social science tend to have qualitative theory and generally can be learn alone without taking a specialized course, for example like reading book or we already have a gift because we are social creature so we naturally already have learnt social science eventhough we learn it just through our experiences not from theory books . Like person who expert in communications and speeches , we can say practically that this person has a communication knowledge eventhough he or she does not know about the communication theories or take communication major in university .
Something else to be considered is that when a company uses money for share repurchases when it could be paying a higher dividend instead, the company’s management is limiting your control and increasing theirs. As a shareholder in a company that makes uses of share repurchases, you have to rely on management’s ability to judge whether it’s an appropriate time to repurchase shares, whereas with your dividend, you have complete control over that choice. The flexibility of dividends for shareholders is great, because if allows you to direct your flow of income to where you think the best investment opportunities are at any given time. Share repurchases lack that
On the other hand MI backed mainly by shareholders equity and performing assets and thus would be able to issue new debt increasing value for both shareholders and the corporation. Thus the shareholders would gain at the expense of bond holders and the equity value of the company would increase. b) Bondholders Bondholders had a lot to lose as according to Project Chariot almost all the debt would be assigned to HM. Given the problems in real estate and hotel markets there was a concern of HM’s ability to meet its debt payment and there was a high probability of default. This meant that the risk was issued at investment grade but now was not backed by valuable assets of the companies which were to be spun off to MI which was to be backed by equity.
By expanding into the market of low cost tax accounting services this firm will be able to remain competitive and profitable. To successfully complete this goal, the company will hire non-Certified Public Accountant (CPA) tax consultants. Non-CPA tax consultants require less compensation than their CPA counterparts, thus aiding in the goal to reduce costs. By hiring non-CPAs, this firm will be adopting an ethical responsibility to clients, the public, and the non-CPA employees. The American Institute of Certified Public Accountants (AICPA) has published guidance on various ethical issues that may possibly arise from the shift in business strategy in this firm.
What are the main benefits assumed to flow from a merger or takeover? Why do so many mergers and takeovers fail to deliver improved financial performance? Illustrate your answer with relevant financial case analysis. In a highly competitive environment, many companies find it difficult to increase their market share, and hence have no choice but resort to restructuring, mergers and takeovers. Such decisions are forced to be made as mergers and takeovers encourage the increase of share market dominance, obtain economies of scale and create synergies.