In terms of economic importance, the corporation is the dominant form of business organization in the United States. This dominance is caused by the many advantages of the corporate form: (1) limited liability for the stockholders, (2) continuity of life, (3) ease in transferring ownership (stock), and (4) opportunities to raise large amounts of money by selling shares to a large number of people. The primary disadvantage of a corporation is that its income may be subject to double taxation (it is taxed when it is earned and again when it is distributed to stockholders as dividends). In this textbook, we emphasize the corporate form of business. Nevertheless, the accounting concepts and procedures that we discuss also apply to other types of businesses.