Accounting for Business

Running head: ACCOUNTING FOR BUSINESS
Accounting for
Business
9/11/2019

ACCOUNTING FOR BUSINESS 1
Table of Contents
Introduction................................................................................................................................2
Forms of Organization...........................................................................................................2
Sole Proprietorship.............................................................................................................2
Partnership..........................................................................................................................2
Impact of choice of organization on Finance.........................................................................3
Sources of raising funds.........................................................................................................3
Security for arranging finance................................................................................................3
Required Accounting Information.........................................................................................4
Required Non-financial Information......................................................................................4
Accounting Skills needed to operate the business.................................................................4
Conclusion..................................................................................................................................5
References..................................................................................................................................6

ACCOUNTING FOR BUSINESS 2
Introduction
The intent of this paper is to support Tim is selecting the form of organization that he can
adopt to operate the business in the Sydney, Australia. Tim is from Darwin and wants to start
a business of his own. He is thinking to purchase a delicatessen in Sydney. The shop has been
in the market for many years but has not attained any success. Tim does not have enough
savings and has to borrow high amount of fund for purchasing the shop. This paper is
supporting Tim to identify the best form of organization that can be established within limited
budget.
Forms of Organization
Sole Proprietorship
A sole proprietorship is also called as the sole trader, proprietorship or individual
entrepreneurship is a kind of enterprise that is operated by single person and under which
there is no legal division between the business entity and the owner. The advantages that can
be gained by Tim by adopting sole proprietorship are to start a business with low budget. In
comparison to sole proprietorship, other forms of businesses are costly. Sole proprietorship is
inclined to be reasonable models to start as well as to maintain. On the other side, this model
is comprised of some of the disadvantages that are it increases the liability of the owner
(Permwanichagun, Kaenmanee, Naipinit and Sakolnakorn, 2014). If the debt of the business
that Tim is planning to establish becomes overwhelming the finance of the owner will be
impacted.
Partnership
A partnership is said to be a form of arrangement between two or more parties for managing
and operating the business and sharing the profits and losses. Tim can adopt this form of