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  • Accounting Lesson 2

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    peter banjao
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    This document covers the topics in Week 002 which includes different types of business organizations categorized by ownership (sole proprietorship, partnership, corporation) and by nature of activity (service, merchandising, manufacturing). It also defines three categories of business activities: operating activities involving generation of revenue and expenses; investing activities related to buying/selling long-term assets; and financing activities concerning raising funds from investors/creditors. The learning objectives are to define and differentiate these business organizations and activities.

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    This document covers the topics in Week 002 which includes different types of business organizations categorized by ownership (sole proprietorship, partnership, corporation) and by nature of activity (service, merchandising, manufacturing). It also defines three categories of business activities: operating activities involving generation of revenue and expenses; investing activities related to buying/selling long-term assets; and financing activities concerning raising funds from investors/creditors. The learning objectives are to define and differentiate these business organizations and activities.

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    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Flag for inappropriate content
    Download as pdf or txt
    25 views10 pages

    Accounting Lesson 2

    Uploaded by

    peter banjao
    This document covers the topics in Week 002 which includes different types of business organizations categorized by ownership (sole proprietorship, partnership, corporation) and by nature of activity (service, merchandising, manufacturing). It also defines three categories of business activities: operating activities involving generation of revenue and expenses; investing activities related to buying/selling long-term assets; and financing activities concerning raising funds from investors/creditors. The learning objectives are to define and differentiate these business organizations and activities.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Flag for inappropriate content
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    of 10

    Week 002

    Business Organizations
    and Activities
    Week 002: Business Organizations and Activities

    Module Coverage
    Business Organizations as To Ownership
    Sole Proprietorship
    Partnership
    Corporation
    Business Organizations as To Nature of Activity
    Service Concern
    Merchandising Concern
    Manufacturing Concern
    Different Categories of Business Activities
    Operating Activities https://www.google.com.ph/search?q=business+organ
    izations+and+activitiesimages+and+photos

    Investing Activities Retrieved: August 12, 2017

    Financing Activities
    Week 002: Business Organizations and Activities

    Learning Objectives

    At the end of the module, you are expected to be able to

    •Enumerate, define, and differentiate the different


    business organizations as to ownership; as to nature of
    business activity

    •Enumerate, define, and cite examples of different


    business activities
    Week 002: Business Organizations and Activities

    Types of Business Organizations

    According to Ownership
    • Sole Proprietorship- owned by one person.
    • Partnership- consists of two or more individuals
    called partners.
    • Corporation- consists of at least five persons to
    incorporate; created by operation of law.

    https://www.google.com.ph/search?q=+business+org
    anizations+images+and+photos
    Retrieved: August 12, 2017
    Week 002: Business Organizations and Activities

    Comparison of Business Organizations


    Sole
    Proprietorship Partnership Corporation
    One owner, Two or more
    called owners, called Many (at least five) owners, called
    Ownership proprietor partners shareholders

    Limited, depends
    Organization's Limited, on the owner's Indefinite life ( in the Philippines, 50
    life span depends on the decision or death years renewable
    owner's
    decision or
    death
    Owners'
    personal Owner
    liability for the personally Partners
    business liable personally liable Shareholders are not personally liable
    obligations or
    debts
    Organization's
    accounting Separate from Separate from the
    status the proprietor partners Separate from the corporation

    https://www.google.com.ph/search?q=+business+o
    rganizations+images+and+photos
    Retrieved: August 12, 2017
    Week 002: Business Organizations and Activities

    Types of Business Organizations (continued)

    According to the Nature of Activity


    • Service concern- rendering services to clients as the
    source of income
    • Merchandising – buying goods and selling the same
    as is.
    • Manufacturing Concern – producing finished goods
    to be sold in the market https://www.google.com.ph/search?q=merch
    andising+and+manufacturing++images+and+
    photos
    Retrieved: August 12, 2017
    Week 002: Business Organizations and Activities

    Categories of Business Activities

    Operating Activities - generation of revenues and incurrence of


    expenses in the company’s main line of business.
    Examples:
    Collections from customers
    Interest received on Notes Receivable
    Dividends received on investments in stocks
    Payments to suppliers
    Payments to employees
    https://www.google.com.ph/search?q=op
    Payments for interest erating+activitiess+images+and+photos
    Retrieved: August 12, 2017

    Payments for income taxes


    Week 002: Business Organizations and Activities

    Categories of Business Activities (continued)


    Investing Activities. Related to buying and selling of the long-
    term assets (plant, property, and equipment, stocks, bonds) for
    business use.
    Examples :
    Sale of plant assets
    Sale of investments that are not cash equivalent
    Receipts on loans receivable
    https://www.google.com.ph/search?q=investing
    Acquisition of plant assets +activitiess+images+and+photos
    Retrieved: August 12, 2017
    Purchase of investments that are not cash equivalents
    Making loans
    Week 002: Business Organizations and Activities

    Categories of Business Activities (continued)


    Financing activities. Raising funds from prospective investors
    and creditors needed by the firm to start or to sustain the
    business.
    Examples :
    Issuance of stocks
    Selling treasury stocks
    Borrowing funds
    Payment of dividends
    https://www.google.com.ph/search?q=financing+
    Purchase of treasury stocks activitiess+images+and+photos
    Retrieved: August 12, 2017

    Payment of principal amount of long-term debts


    Thank you very
    much and
    God bless you all…

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