1] What is meant by the terms depreciation and accumulated depreciation? In which financial statement does each of these items appear? What is accrual accounting and how does it influence financial statement presentation?
2] Six months ago, you invested $350,000 to become a partner in a medical practice in which you have a 50% ownership interest. Today, your partner defaulted on the payments for a $2 million Open MRI system that is used by the partnership. What is the dollar amount of your personal liability exposure if you are a) the general partner, and b) if you are a limited partner? Discuss the characteristics of general and limited partners, and how these influence the liability amounts.