T2 2019 HC1010: Accounting for Business Decisions Assignment

This assignment solution explores the core concepts of accounting for business, addressing key aspects such as different forms of business organization (sole proprietorship, partnership, and corporation), and the implications of each on raising finance. It delves into the availability of finance, considering factors like interest rates, market conditions, and customer profiles, and emphasizes the importance of accounting and non-financial information in making sound business decisions. The solution also highlights the necessary skills and accounting knowledge required for effective business management, and concludes with a recommendation for the most suitable business form based on the case study provided. The paper includes references to relevant academic sources to support the analysis. It is designed to provide a comprehensive understanding of accounting principles in a business context, making it a valuable resource for students studying finance and accounting.

Running head: ACCOUNTING FOR BUSINESS
Accounting for Business
Name of the Student:
Name of the University:
Author’s Note:

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Table of Contents
Introduction......................................................................................................................................2
Forms of Organization.................................................................................................................2
Raising Required Finance............................................................................................................3
Availability of Finance................................................................................................................3
Accounting and Non-Financial Information’s.............................................................................4
Skills and required accounting knowledge..................................................................................5
Conclusion.......................................................................................................................................5
References........................................................................................................................................6

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Introduction
Financing plays an important role and the amount of finance that is required by an
entrepreneur for utilizing the same in the due course of business operations should be well based
on the cost benefit analysis. The different form of organization structure that Tim can consider
for the purpose of starting the business and the associated benefits and problems that would be
flowing to Tim from the same has been well taken into consideration. Availability of finance and
the factors affecting the finance availability of the same including the interest rate movement,
general business market conditions and the profile of the customers are some of the key points
that should be well taken into consideration.
Forms of Organization
A business organization can be classified in to three categories these are sole
proprietorship partnership and corporation. All the three types has its own features and
characteristics which are explained below
Sole proprietorship
The sole proprietorship business is a kind of business that is controlled by a single owner
and all the activities of this kind of organization are controlled by an individual. The owner takes
all the decisions that rare related with the business and take all the responsibilities for operating
the business. The main advantage of this kind of business is that as the control remains in the
control of an individual person so no conflict arises in taking any major decisions and the
decision of the owner is considered as the final one. The disadvantage of this kind of business is

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the unavailability of the adequate capital and the management support that can be obtained if it
would have been in other forms of organization (Segal and Choi 2016).
Partnership
In partnership business there are more than one individual ad the business decision is
taken on the basis on the decision of the partners. The partners combinedly take a decision and
give instructions on that basis. The main advantage of partnership is that a combined decision
can be taken which can give a better result. The disadvantage is that it may rise in conflict of
interest (Chavis 2017).
Corporation
A corporation is a legal entity that is formed for the purpose of the conducting business.
The corporation acts as a separate entity which handles and controls various responsibilities that
are related with the organization (Eisenberg 2017).
Raising Required Finance
The finance that is required by the Tim for the purpose of operations of the company
should be primarily borrowed or raised with the help of the equity finance for the company. The
finance amount can be easily achieved by the company in the form of equity and long-term
borrowings if the company goes for a corporation form of organization. If Tim considers going
for a sole proprietorship and partnership business than he might have to offer or submit some
kind of mortgage that would be in the form of non-current assets like land, investments, gold or
any other items that could be kept as an mortgage for the purpose of raising appropriate level of
finance.

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Availability of Finance
The finance amount that is required by Tim for the purpose of the business operations of
the company will be solely dependent on the choice of organization that he or she would be
selecting. Usually it is seen that a sole proprietorship business would be easily getting small
loans which primarily will be in the form of short term loans. On the other hand, if Tim
Considers going for a Corporation form of business than the finance amount that Tim can easily
get would be in the form of Equity Share Fund, Fund received through the issuance of bonds and
long term loans. The options that Tim would be getting on the other hand, in the partnership
business would be in the form of personal capital and short term loans. However, given the case
study analysis that Tim would be considering for the availability of finance should be
Corporation form of business organization as Tim personally do not have any personal security
and finance amount that he can easily bring in. It is important to note that the Availability of
finance and the factors affecting the finance availability of the same including the interest rate
movement, general business market conditions and the profile of the customers are some of the
key points that should be well taken into consideration.
Accounting and Non-Financial Information’s
There are large number of accounting information that Tome can make use of by taking
into the account the purpose of purchasing the business and the accounting information is
required to finance the funding of business operations and the related cost of finance (Schroeder,
Clark and Cathey 2019). The accounting information can be considered very helpful in sharing
the capital that are scarce and those that are available to the company. One of the prime example
of the budgeted financials is attached outline of the numerous business functions that will be

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executed by the company inside the span of three years and related profits which the company
will be producing from the accounting information.
Apart from this, the non-financial information of an organization is mainly regarded as
the vital business factors, such as market penetration and numerous types of other economic
factor which can potentially create an impact on the business operations of the company
(Henderson et al., 2015). These are regarded as the important non-financial information that is
needed in administering the business.
Skills and required accounting knowledge
The key skills and the needed knowledge which would be needed by Tim within the
course of business is to develop an overall business knowledge, roles that are played by the
accounting in the financial application of managing business activity, technological updates and
skills, communication skills, leadership abilities, better consumer service orientation and
specialized experience.
Conclusion
On a conclusive note, every type of business has their own set of positive and negative
which are highlighted for Tim’s new business considerations that he would be making for
commencing new purchase where company form is recommended.

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References
Chavis, D.B., 2017. A Case Study of a Business-Education Partnership through Internships.
Eisenberg, M.A., 2017. Legal models of management structure in the modern corporation:
Officers, directors, and accountants. In Corporate Governance (pp. 103-167). Gower.
Henderson, S., Peirson, G., Herbohn, K. and Howieson, B., 2015. Issues in financial accounting.
Pearson Higher Education AU.
Schroeder, R.G., Clark, M.W. and Cathey, J.M., 2019. Financial accounting theory and
analysis: text and cases. John Wiley & Sons.
Segal, S.P. and Choi, J.S., 2016. Ownership form and quality of care in sheltered care facilities:
Chain-affiliated business vs. sole proprietorship.