Bookkeeping: Legal Entity And Chart Of Accounts

Within business, one of the initial concepts to discern is the type of legal entity to establish.  This factor is extremely important with regards to legal liability, taxes, profit-sharing and operation. 

Every business in the U.S. falls into one of three categories, as defined in the federal tax code: 

• Sole proprietorship
• Partnership 
• Corporation 

The basic accounting rules for all three types are generally the same, although a business’s structure determines how profits will be taxed, and smaller companies can choose between the cash and accrual methods of accounting.

This course focuses on understanding the various types of legal entities and examines their structure to determine which type is best for various businesses.  We examine steps for the small business owner and bookkeeper to set up their entity, business and overall administrative processes.  Lastly, we delve into the important concepts surrounding developing your financial chart of accounts and evaluating important considerations prior to beginning the process.

Whether you are a business owner or want to develop the skill of bookkeeping to begin a career, there are critical accounting and bookkeeping concepts that are important to learn. These courses have been developed by a CPA who has both small and large business accounting experience and background.  The full curriculum of courses will provide you with the ultimate foundation to a career as a bookkeeper.  

NOTE: This course is one of a series of courses developed for the Professional Bookkeeping Certification program on Illumeo. The full curriculum of courses will provide you with the ultimate foundation to a career as a bookkeeper. 

Note: Information within this course comes from readily available public domain documents and is utilized by the trainer as a supplement for relaying the course content.