Enterprise Organization Outline
Introductory Material
I. Practicing Corporate Law/Intro to Business
A. Roles of the Corporate Lawyer
1. Counselor—gives advice to client
2. Conciliator—resolves conflict b/t client and another
3. Facilitator—facilitates transaction b/t client and another party
4. Guardian—protects client and public against some contemplated actions by persons acting on client’s behalf (“gatekeeper”)
B. Core Areas of Knowledge
1. Law of business entities
a. Law governing corporations, partnerships, LLCs
b. Corporations law—state statute
c. Partnership law—Uniform Partnership Act (widely adopted)
d. LLCs—state statute
2. Law of agency
a. Almost all common law
b. Restatement (3rd)of Agency
3. Contract law
4. Tax law
5. Securities regulation
C. Business and Businesses
1. Why Businesses Vary in Size (CMBE pg. 19)
a. Horizontal integration
i. Business has multiple locations that do single operations
ii. I.e., coffee—firm specializes in doing only one of following: growing coffee, importing raw beans, roasting beans, distributing beans to retailers, retailing beans, or retailing coffee drinks latte by latte
b. Vertical integration
i. Business does the producing, processing, and selling in a single locale
II. Introduction to Accounting
A. Financial accounting—providing statements, etc. to the outside world
B. Managerial accounting—internal purposes
C. The Accounting Process
1. Record transactions
2. Classify
3. Report
D. Three Basic Statements
d first; equity holders get paid after debts paid off, but they can get a return on their equity
Total
Total
o Transactions Not Affecting Owners’ Equity (only affecting assets and/or liabilities)
§ Purchase of equipment for cash (asset acct. of equipment increases; asset account of cash decreases)
§ Purchase of equipment on credit (asset acct. of equipment increases; liability (Accts. Payable) increases)
§ Both ways, things in the balance sheet are offset, but owners’ equity not affected.
o Transactions Affecting OE
§ Owners’ investment—increases (capital)
§ Owner w/d’ing capital—decreases
o Revenue and expenses will affect OE
§ Whenever revenue increases, OE acct increases
§ Whenever expenses increase, OE acct decreases
· Debits and Credits
Account Name
Debit (always on left)
Credit (always on right)
Increase +
Decrease –
Normal √
Asset
Debit (always on left)
Credit (always on right)
