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Accounting, Finance, SPSS
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Client Letter

Essay Instructions:

Assignment 1: Client Letter Imagine that you are a Certified Public Accountant (CPA) with a new client who needs an opinion on the most advantageous capital structure of a new corporation. Your client formed the corporation in question to provide technology to the medical profession to facilitate compliance with the Health Insurance Portability and Accountability Act (HIPAA). Your client is very excited because of the ability to secure several significant contracts with sufficient capital. Use the Internet and Strayer databases to research the advantages and disadvantages of debt for capital formation versus equity for capital formation of a corporation. Prepare a formal letter to the client using the six (6) step tax research process in Chapter 1 and demonstrated in Appendix A of your textbook as a guide. Write a one to two (1-2) page letter in which you: Compare the tax advantages of debt versus equity capital formation of the corporation for the client. Recommend to the client whether he / she should use debt or equity for capital formation of the new corporation, based on your research. Provide a rationale for the response. Use the six (6) step tax research process, located in Chapter 1 and demonstrated in Appendix A of the textbook, to record your research for communications to the client. Here are the 6 steps: In both open- and closed- fact situations, the tax research process involves six basic steps: 1. Determine the facts. 2. Identify the issues ( questions). 3. Locate the applicable authorities. 4. Evaluate the authorities and choose those to follow where the authorities conflict. 5. Analyze the facts in terms of the applicable authorities. 6. Communicate conclusions and recommendations to the client.

Essay Sample Content Preview:

Client Letter
Submitted By:
Instructor:
Date of Submission:
Proficient Accountants
1111 46th Street
Tulsa, OK 74106
October 19, 2014.
James Chase, Chief Executive Officer
Medics Technologies
1111 46th Street
Tulsa, OK 74106.
Dear Mr. Chase
We are pleased to address you today with reference to your newly formed corporation, Medics Technologies. As there is a strong need for steps to make sure conformity of your firm with the Health Insurance Portability and Accountability Act in the medical field, we as Proficient Accountants are excited to be part of your team.
You wrote to us on October 15, 2014 requesting for guidance with regards to the most advantageous capital formation between debt financing and equity financing for the new corporation. Whilst both forms of capital financing have their own unique advantages and disadvantages, debt financing holds the biggest tax advantages for your company.
In reaching this supposition, research was conducted on both forms of financing. Particular attention was paid to the tax disadvantages and advantages of each. In addition, any information that was disclosed to our firm about your new corpor...
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