ATTENTION: I PAY EVERY MONTH TO BE ABLE TO POSTQUESTIONS HERE. tHEREFORE I EXPECT...

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Accounting

ATTENTION: I PAY EVERY MONTH TO BE ABLE TO POSTQUESTIONS HERE. tHEREFORE I EXPECT COMPLETE AND QUALITY ANSWERS.PLEASE READ CAREFULLY THE QUESTIONS AND ANSWER THEM THOROUGHLY. DONOT COPY AND PASTE A SOLUTION THAT IS ALREADY POSTED BY SOMEONEELSE ON CHEGG. REFRAIN FROM ANSWERING IF YOU CANNOT FULFILL MYDEMAND. DON'T WASTE MY QUESTION AS THEY ARE LIMITED.
THANKS
Business Entities—Partnerships and Corporations
Assume Target Corporation is involved in a major lawsuit and theprobable damages are estimated to be $2,000,000.
A. Describe the effects damage estimates would have on thefinancial statements of a corporation and a partnership. $2 Millionis not significant for any of the companies...So, answer itassuming the $ amount is and is not significant.

B. How do disclosure requirements differ from a corporation to apartnership and what information is required?  Here - bespecific on what the SEC requires vs. what partnership accountingwould look like
C. Are the shareholders at risk for any personal liability withthe company set up as a corporation? Defend yourresponse.  Here you might indicate what if anycircumstances the shareholders would be liable
D. If Target Corporation was set up as a partnership, would thepartners be at risk for personal liability? Defend your response.Same as C. above. You might indicate what if any circumstances thepartners would be liable
Wrap up it with a conclusion that brings it alltogether.

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3.6 Ratings (256 Votes)

AIf Target was involved in a major lawsuit any potential losses that could arise from the lawsuit should be treated as a contingent liability According to FASB guidelines contingent liabilities can be recorded in the books of accounts only if the contingency is probable and the amount of the liability can be estimated Since it meets all the requirements the potential loss would be recorded in the balance sheet and income statement As soon as Targets legal team gets the estimate there should be a debit to legal expense account for two million and a credit to the accrued liabilities account for two million When the lawsuit is settled target will debit accrued liability and credit cash There will no impact on cash flow for the recording of the contingent liabilities till the liabilities are actually paid BCompanies that are privately owned are not required to release financial and operating information by law So some companies may decide to provide such information only on a need to know basis The disclosure requirements for the lawsuit See Answer

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In: AccountingATTENTION: I PAY EVERY MONTH TO BE ABLE TO POSTQUESTIONS HERE. tHEREFORE I EXPECT COMPLETE...ATTENTION: I PAY EVERY MONTH TO BE ABLE TO POSTQUESTIONS HERE. tHEREFORE I EXPECT COMPLETE AND QUALITY ANSWERS.PLEASE READ CAREFULLY THE QUESTIONS AND ANSWER THEM THOROUGHLY. DONOT COPY AND PASTE A SOLUTION THAT IS ALREADY POSTED BY SOMEONEELSE ON CHEGG. REFRAIN FROM ANSWERING IF YOU CANNOT FULFILL MYDEMAND. DON'T WASTE MY QUESTION AS THEY ARE LIMITED.THANKSBusiness Entities—Partnerships and CorporationsAssume Target Corporation is involved in a major lawsuit and theprobable damages are estimated to be $2,000,000.A. Describe the effects damage estimates would have on thefinancial statements of a corporation and a partnership. $2 Millionis not significant for any of the companies...So, answer itassuming the $ amount is and is not significant. B. How do disclosure requirements differ from a corporation to apartnership and what information is required? Here - bespecific on what the SEC requires vs. what partnership accountingwould look likeC. Are the shareholders at risk for any personal liability withthe company set up as a corporation? Defend yourresponse. Here you might indicate what if anycircumstances the shareholders would be liableD. If Target Corporation was set up as a partnership, would thepartners be at risk for personal liability? Defend your response.Same as C. above. You might indicate what if any circumstances thepartners would be liableWrap up it with a conclusion that brings it alltogether.