Question

1.Why should an owners personal assets not be included with the assets of the corporation?

2.Discuss why a business would want to produce finacial statements more than once a year

3.If you owned a business, would you want to use another company's financial statements to compare your operating results to?

plz solve all the question plz quickly

Answer 1

1)

Owners personal asset is out of his personal income on which a owner has paid taxes.Corporation's assets are assets which belongs to corporate only.Since the corporate is separate legal entity,it has rights to own properties in it's name.The corporates are also eligible to sue and to be sued by anyone.This state of corporates clearly segregate the owners rights on the assets of corporates.

2)

The business would want to furnish financial statements for more than once in accounting period,If a business want's to raise money by any public issue of shares or debentures,or to comply with any legal requirements.

3)

Yes,I will always want my operating results to be compared with the peers.This comparision will show the strengths and weakness in our existing processes of business.If the peers has same capital structure or same technology then the comparision becomes much important.

This comparision will allow my current business to be well prepared for the existing or upcoming weaknesses.

Overall benchmarking process will have positive effect at strategic level.

Please comment for any explanation.

Thanks