Explain what is meant and the importance of the following statement: “Whereas the balance sheet can be thought of as a snapshot of the firm’s financial position at a point in time, the income statement reports on operations over a period of time”.

For this week’s assignment, you will research and answer the following questions. Explain what is meant and the importance of the following statement: “Whereas the balance sheet can be thought of as a snapshot of the firm’s financial position at a point in time, the income statement reports on operations over a period of time”. Why is this distinction important? What other financial reports are used to evaluate the financial solvency of a business entity? If you were starting a business, what tax considerations might cause you to prefer to set it up as a proprietorship, limited liability company, limited liability partnership, S Corporation or a C Corporation? Resources: Small Business Administration Website, Investopedia and also the Internal Revenue Service Website Small Business Portal. Include in your discussion: legal liability, allocation of responsibility for payment of income tax, when must an owner/investor must also be an employee, restrictions on who can invest in your business. Assignment Details: The paper should be two pages. Use APA format (title page, double-spaced, references). Don’t forget to submit your document.

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