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Accounting for Governmental & Nonprofit Entities 17th Edition by Jacqueline Reck,Suzanne Lowensohn,Earl Wilson
Edition 17ISBN: 978-1259564239Accounting for Governmental & Nonprofit Entities 17th Edition by Jacqueline Reck,Suzanne Lowensohn,Earl Wilson
Edition 17ISBN: 978-1259564239 Exercise 1
Identify some differences between business organizations and government/ not-for-profit organizations.
Explanation
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Business organizations:
Business organizations are generally formed to earn income. The main aim of the owners of these organizations is to make profit. Business organizations refers to an individual or group of people who work together to attain certain commercial objectives.
Non-profit organization:
It is an individual or group of people who work together to attain the goals and mission of an organization. It will not earn profit for the owners.
Difference between business and non-profit organization:
The people who provide resources for the organization will expect repayment or any other benefits in the business organization. In non-profit organization, people will not expect repayment as the resources will be provided with service perspective.
The primary objective of the business organization is to earn profit and the basic operation of the business organization is to provide goods and services for profit. However, the primary objective of non-profit organization is to provide service without cost or profit. The basic operation of the non-profit organization is providing goods and service without expecting profit or equivalent benefits.
Conclusion:
In business organization, there will be an ownership interest, which can be sold or transferred. The owner has the right on the ownership interest, which he or she can use as a resource at the time of liquidation. There will not be any definite ownership interest in the non-profit organization.
Business organizations are generally formed to earn income. The main aim of the owners of these organizations is to make profit. Business organizations refers to an individual or group of people who work together to attain certain commercial objectives.
Non-profit organization:
It is an individual or group of people who work together to attain the goals and mission of an organization. It will not earn profit for the owners.
Difference between business and non-profit organization:
The people who provide resources for the organization will expect repayment or any other benefits in the business organization. In non-profit organization, people will not expect repayment as the resources will be provided with service perspective.
The primary objective of the business organization is to earn profit and the basic operation of the business organization is to provide goods and services for profit. However, the primary objective of non-profit organization is to provide service without cost or profit. The basic operation of the non-profit organization is providing goods and service without expecting profit or equivalent benefits.
Conclusion:
In business organization, there will be an ownership interest, which can be sold or transferred. The owner has the right on the ownership interest, which he or she can use as a resource at the time of liquidation. There will not be any definite ownership interest in the non-profit organization.
Accounting for Governmental & Nonprofit Entities 17th Edition by Jacqueline Reck,Suzanne Lowensohn,Earl Wilson
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