Chapter01 - Chapter One Introduction to Financial...

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1 Chapter One Introduction to Financial Statements Zining Li ACCT 2301 FALL 2009 Cox School of Business, SMU Acct 2301 Li Fall 09 Chapter 1 1 What do we hope to learn? z What are the characteristics of a corporation? z What are the four basic financial statements? z What information does each statement convey? z What categories of items are reported in each financial statement? z How are elements within a statement related?
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2 Acct 2301 Li Fall 09 Chapter 1 2 How is Business Formed z Sole proprietorship z Single owner z z Partnership z Two or more owners, but not a separate entity z Corporation z Typically multiple owners z separate legal entity z This course is about Corporations. Acct 2301 Li Fall 09 Chapter 1 3 Corporations z Popular form of business because… z It’s simple for individuals to purchase small amounts of stock z Allows easy transfer of ownership through established exchanges z Provides limited liability – the most you can lose is your initial investment z Easier to raise capital
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3 Acct 2301 Li Fall 09 Chapter 1 4 Separate Legal Entity z Since a corporation is a separate legal entity it can: z Own assets
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This note was uploaded on 02/24/2011 for the course ACCT 2301 taught by Professor Sss during the Spring '11 term at Santa Barbara City.

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Chapter01 - Chapter One Introduction to Financial...

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