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Chapter 15, Analysis Case

Chapter 15, Analysis Case - 25th Aug 2011 Module 1 Group A...

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25 th Aug. 2011 Module 1, Group A Chapter 15 Analysis Case RE: 1).What differences between NTCI II's financial statements and those of an incorporated entity exist? 2). Assume that this potential investor is not aware of the potential implications of owning a partnership rather than a corporation. What information is available in these statements to advise this individual of the unique characteristics of this legal business form? 1) There are many differences in the NTCI II’s financial statements compared to an incorporated entities financial statements. The three main statements are different in the way they are titled. First, the Balance Sheet has the title “partners’ (deficiency) capital” instead of stockholders’ equity. These two titles are very different. Stockholders’ equity is interpreted to mean what the stockholder’s have left. “Partners’ (deficiency) capital” is interpreted to mean that there is a deficiency on the partner’s capital. To me that means there is a shortage of partner capital.
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