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1.5 Hours (On-Demand)
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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. 

Learning Objectives

  • Explore the definition of accounting and legal business entities and their purpose.
  • Explore the types of legal business entities.
  • Explore methods to set up your business.
  • Explore methods to set up your organization structure.
  • Identify key criteria for a chart of accounts.
  • Identify key steps for developing your chart of accounts.
Last updated/reviewed: November 10, 2019

Included In Certifications

This course is included in the following Certification Programs:

14 CoursesProfessional Bookkeeping Certification

  1. Bookkeeping: Terminology and Process Execution
  2. Bookkeeping: Debits And Credits
  3. Bookkeeping: Cash vs. Accrual
  4. Bookkeeping: Payroll And Expenses
  5. Bookkeeping: Legal Entity And Chart Of Accounts
  6. Bookkeeping: Journals, Subsidiary Ledgers and General Ledger
  7. Bookkeeping: Responsibilities
  8. Bookkeeping: Fixed assets and inventory
  9. Bookkeeping: Accounts Payable/Accounts Receivable And Receipts
  10. Management Internal Control Essentials
  11. GAAP Principles, Assumptions and Considerations
  12. GAAP Presentation of Financial Statements
  13. Bookkeeping Basics – Case Study Scenario
  14. Useful Bookkeeping Tools

10 Reviews (24 ratings)Reviews

4
Anonymous Author
This is a very valuable segment. Although I am very familiar with COA(s) the importance and the ability to build from the ground up is essential for quick reporting to know where you are and where you are spending your money. This segment also lets you know why which is very important
5
Member's Profile
the information was fantastic ... however some pic of act of incorporation or partnership agreements and COA, etc ..during the lecture to see what it looks like would have been great...
5
Member's Profile
I learned about the Tutorial on various business set ups and how they impact with owners and preparers of financial statements. Chart of account steps were clear and elaborate
5
Anonymous Author
This is a good review and summary of the different entities. I especially appreciated the COA information and the things to consider during the initial setup.
4
Anonymous Author
I thought that it was very informative and helped me learn very important details that can be applied to my job.
5
Member's Profile
Easy to understand explanations of all entities. Good info on charts of accounts and how to plan execution.
5
Member's Profile
This segment was difficult, so much information to keep straight between the catagories.
5
Anonymous Author
Thorough information with numerous examples to illustrate covered topics.
5
Member's Profile
This course gave me a clear understanding between the different entities.
4
Anonymous Author
It wasn't as comprehensible as the other courses but still good.

Prerequisites

Course Complexity: Foundational

No Advanced Preparation or Prerequisites are needed for this course. However, it is recommended to take the other courses in the series prior to completing this one.

Education Provider Information

Company:
Illumeo, Inc., 75 East Santa Clara St., Suite 1215, San Jose, CA 95113
Contact:
For more information regarding this course, including complaint and cancellation policies, please contact our offices at (408) 400- 3993 or send an e-mail to .

3 QuestionsCourse Questions and Answers

User picture

I really appreciated this course. On the quiz for this course the "correct" answer to question #1 was listed as "Limited Liability Corporation." However, since LLC's are not "incorporated" shouldn't the answer really read "Limited Liability Company"? I point this out because it could be confusing for people who are trying to learn the facts and differences about entities, and I like this course so much I just want to help make it better.

Member's Profile

very good catch. That was the wording error. We will correct it thanks so much for bringing it to the attention

Member's Profile

Thank you so much for highlighting this. Therefore, the correction has been done accordingly.

Course Syllabus
INTRODUCTION AND OVERVIEW
  2:37Introduction to Bookkeeping Basics – Formation of a Legal Entity and Establishing a Chart of Accounts
  9:33Accounting Entity and Legal Entity Defined
  11:36Types of Entities: Part 1
  11:20Types of Entities: Part 2
  8:41Types of Entities: Part 3
  7:47Establishing Your Operating Structure
  10:26Chart of Accounts (COA)
  6:42Key Steps to Develop the COA
  1:46Summary
CONTINUOUS PLAY
  1:10:29Bookkeeping Basics – Formation of a Legal Entity and Establishing a Chart of Accounts
SUPPORTING MATERIALS
  PDFSlides: Bookkeeping Basics – Formation of a Legal Entity and Establishing a Chart of Accounts
  PDFBookkeeping Basics – Formation of a Legal Entity and Establishing a Chart of Accounts Glossary/Index
REVIEW AND TEST
  quizREVIEW QUESTIONS
 examFINAL EXAM