Reitmans (Canada) Limited, Canada's largest women's specialty retailer, was founded in 1926 by Herman and Sarah Reitman. Their traditional "general store" opened on Saint-Laurent Boulevard in Montreal and was run and managed by the Reitman family. The popularity of their clothing line prompted them to open their second store, which exclusively sold women's apparel. Over the last 85 years, Herman and Sarah's children and grandchildren have taken a family-operated business and transformed it into one of Canada's largest fashion retailers.
Instructions
(a) When Herman and Sarah Reitman opened their first store, they may have operated it as a partnership or they may have incorporated the business from the start. What factors might have influenced their decision?
(b) Regardless of its start, Reitmans is now organized as a corporation. What factors may have influenced this decision?
(c) Look at Reitmans (Canada) Limited's corporate financial statements reproduced in Appendix A at the back of this textbook. In what ways would the partnership financial statements have been different from these corporate statements?