Answer to Question #64706 in Accounting for JAY

Question

How do the financial statements for a corporation differ from the statements for a proprietorship? Do you feel that the general public understands the owner equity section of each type of business?

Answer 1

A proprietorship must file less statements than a corporation. He does not need to make such statements as: Statement of Owner’s Equity (because he is a single owner), Cash Flow Statements. He must make a balance and P&L statement for a proprietorship.