Spencer Software Company has assets of $1,020,000 and liabilities of $552,000.

a. Prepare the owners’ equity section of the company’s balance sheet under each of the following independent assumptions:
1. The business is organized as a sole proprietorship, owned by Johanna Spencer.
2. The business is organized as a partnership, owned by Johanna Spencer and Mikki Yato. Spencer’s equity amounts to $288,000.
3. The business is a corporation with 27 stockholders, each of whom originally invested $12,000 in exchange for shares of the company’s capital stock. The remainder of the stockholders’ equity has resulted from profitable operation of the business.
b. Assume that you are a loan officer at Security Bank. Spencer Software Company has applied to your bank for a large loan to finance the development of new products. Does it matter to you whether Spencer is organized as a sole proprietorship, a partnership, or a corporation? Explain.