BUSINESS UNIT Definition

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BUSINESS UNIT is equivalent to a wholly owned subsidiary except that it is not treated as a separate legal entity. It is an organization within a firm that could operate separately because it has all support functions contained within the business unit. The internal financial reporting from a business unit to the corporate office is basically identical to a separate legal entity.

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OPERATING EXPENDITURES is the amount used during a particular period directly in support of day-to-day operations such as wages, maintenance, office supplies, etc.

PERSONAL ACCOUNTS represents money due to or due from a person or group of persons. For example, Accounts Payable - Suppliers is a personal account since this amount is payable to a supplier/suppliers.

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