1. Concept Introduction: Public accounting firms provide accounting services to the other firms. Organizations formed by two or more persons for earning profit known as partnership firm. Partners are mutually liable for the acts of partnership. To indicate: If the partners need to pay for merchandise. Partnership firms are those in which two or more people together perform the functions of business. Partners are jointly liable in partnership firm for every action. All partners are liable for any partner’s negligence and mistakes. Hence, in the given case the partners are liable to pay for the merchandise. 2. Concept Introduction: Public accounting firms provide accounting services to the other firms. Organizations formed by two or more persons for earning profit known as partnership firm. Partners are mutually liable for the acts of partnership. To State: If the partners need to pay for merchandise if the firm is a public accounting firm. Public accounting firms provide accounting services to other firms. Generally, the people work in public accounting firm are certified public accountant (CPAs). Partners of public accounting firms are not liable for the actions of each other. Hence, in the given case, the partners would not be liable to pay for merchandise if the firm is a public accounting firm.

8th Edition

ISBN: 9781259662966

Author: John J Wild

Publisher: McGraw-Hill Education

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Solution Summary: The author explains that public accounting firms provide accounting services to other firms. Partnership firms are those in which two or more people together perform the functions of business.