SOLUTIONMANUALFinancialAccounting,13thEdition
c c c c
byWilliamThomasandWendyM.TietzChapters1-12,
c c c c c c c c c
Complete
c
,
,Chapter1 c
TheFinancialStatements
c c
EthicsCheck
c
(5-10min.) EC1-1
c c c
a. Objectivityandindependence
c c
b. Due care c
c. Integrity
d. Integrity
, Short Exercises
c
(10min.) S1-1 c c c
a. Corporation, c limited c partners c of c a c Limited-liability
partnership (LLP) and Limited-liability company (LLC). If any of these
c c c c c c c c c c c c
c businesses fails and cannot pay its liabilities, creditors cannot force
c c c c c c c c c
the owners to pay the business’s debts from the owners’ personal
c c c c c c c c c c c
c assets. Creditors can go after the general partner of a limited liability
c c c c c c c c c c c
partnership.
c
b. Proprietorship. There is a single owner of the business, so the owner c c c c c c c c c c c
is answerableto noother owner.
c c c c c c
c. Partnership. If the partnership fails and cannot pay its liabilities, c c c c c c c c c
c creditors can force the partners to pay the business’s debts from
c c c c c c c c c c
c their personal assets. A partnership affords more protection
c c c c c c c
for creditors than a proprietorship because there are two or more
c c c c c c c c c c c
owners tosharethisliability.
c c c c c
(5min.) S1-2 c c c
1. The entity assumption applies.
c c c
2. Application of the entity assumption will separate Osmond’s c c c c c c c
c personal assets from the assets of Simple Treats, Inc. This will
c c c c c c c c c c
c help Osmond, investors, and
c c c
c c c c
byWilliamThomasandWendyM.TietzChapters1-12,
c c c c c c c c c
Complete
c
,
,Chapter1 c
TheFinancialStatements
c c
EthicsCheck
c
(5-10min.) EC1-1
c c c
a. Objectivityandindependence
c c
b. Due care c
c. Integrity
d. Integrity
, Short Exercises
c
(10min.) S1-1 c c c
a. Corporation, c limited c partners c of c a c Limited-liability
partnership (LLP) and Limited-liability company (LLC). If any of these
c c c c c c c c c c c c
c businesses fails and cannot pay its liabilities, creditors cannot force
c c c c c c c c c
the owners to pay the business’s debts from the owners’ personal
c c c c c c c c c c c
c assets. Creditors can go after the general partner of a limited liability
c c c c c c c c c c c
partnership.
c
b. Proprietorship. There is a single owner of the business, so the owner c c c c c c c c c c c
is answerableto noother owner.
c c c c c c
c. Partnership. If the partnership fails and cannot pay its liabilities, c c c c c c c c c
c creditors can force the partners to pay the business’s debts from
c c c c c c c c c c
c their personal assets. A partnership affords more protection
c c c c c c c
for creditors than a proprietorship because there are two or more
c c c c c c c c c c c
owners tosharethisliability.
c c c c c
(5min.) S1-2 c c c
1. The entity assumption applies.
c c c
2. Application of the entity assumption will separate Osmond’s c c c c c c c
c personal assets from the assets of Simple Treats, Inc. This will
c c c c c c c c c c
c help Osmond, investors, and
c c c
