Answer
See explanation
Work Step by Step
a. A sole proprietorship will be ideal for Natalie Koebel.
Pros of Sole proprietorship: Natalie can start up the sole proprietorship easily, Natalie will control the cookie business by herself, and she will experience tax benefits.
Cons of Sole proprietorship: Natalie will be personally liable for the business issues, and she may have limited capital.
b. Accounting information will help Natalie make decisions regarding the running of the cookie business.
The types of accounting information she will need include total sales, total liabilities, total expenses, tax expenses, travelling expenses, retained profits, total assets, and cash flow statements.
The accounting information will be important because it offers a glimpse of the business's financial performance.
c. Asset accounts include cash and equipment for making cookies.
Liability accounts include unpaid amounts for supplies and loans raised to finance the business.
Revenue accounts include total sales revenue generated from the cookies, income from group sessions, and income from training at home.
Expense accounts include marketing expenses, supplies expenses, and expenses incurred in the purchase of cookies.
d. Having a distinct bank account is imperative for Natalie because it will ensure that the money meant for business is accounted for and spent on business. With a distinct bank account, she will not spend business money on her personal issues. The bank account will enable her to track the inflow and outflow of business cash.
e. She should transform the car into a business asset. Any time she uses the car for personal business, she should reimburse the business.
