Capstone Papers-How to account for partnerships and corporations?
Partnership: The company is considering forming a partnership and wants to be sure it understands the key issues regarding partnership formation, income distribution, and liquidation.
- Explain the process and methods used to account for partnership formation. How do these methods impact the firm’s balance sheet?
- Illustrate how the company could split profits and losses.
- Describe what happens if the partnership doesn’t do well and the company has to dissolve it, or one of the partners becomes insolvent.
- Illustrate the dissolution process by creating a hypothetical cash distribution schedule. Ensure all information is entered accurately.
- Differentiate between various forms of bankruptcy and restructuring that the firm should understand.
- Summarize the key points of interest if the firm fell on hard times and had to file voluntary bankruptcy. What ethical implications should be considered when debating whether or not to file bankruptcy?
- Identify the key areas of concern if the firm fell on hard times and their creditors forced them into bankruptcy. What defenses are available in this situation?
