1. 3.06 Classify the Forms of Business Ownership
What do you know?

2. SOLE PROPRIETORSHIP ONE OWNER 70 % OF THE U.S.
(WANDA IS THE OWNER OF THE
VILLAGE STORE)

3. SOLE PROPRIETORSHIP ADVANTAGES
EASY TO STARTUP.
LIMITED GOVERNMENT REGULATIONS INCLUDING TAXES. (TAXED LESS THAN OTHER FORMS OF BUSINESSES)
ALL PROFITS GO TO THE OWNER.
FREEDOM OF MAKING BUSINESS DECISIONS.

4. SOLE PROPRIETORSHIP DISADVANTAGES
UNLIMITED LIABILITY
BUSINESS LOSSES
BUSINESS DEBTS
SOLELY RESPONSIBLE FOR ALL ASPECTS OF BUSINESS.
LIFE OF THE BUSINESS IS LIMITED.

5. PARTNERSHIP TWO OR MORE OWNERS. < 10% OF U.S. BUSINESSES.
General Partnership
Share equally in profits or losses.
Each partner liable for all debts.
Limited Partnership
Liable up to amount of investment..
Must have at least one general partner who has unlimited liability.
< 10% OF U.S. BUSINESSES.
(JOE AND JOHN OWN A MUSIC STORE)

6. PARTNERSHIP ADVANTAGES
RELATIVELY INEXPENSIVE TO START.
COMBINE FINANCIAL RESOURCES AND KNOWLEDGE.
SHARED MANGEMENT RESPONSIBILITIES.
INCREASED POTENTIAL FOR PROFITS.
SHARED RESPOSIBILITY FOR RISK.
TAXED LESS THAN A CORPORATION.
A CHANGE IN OWNERSHIP DOES NOT ALTER CONTINUITY OF THE BUSINESS.

7. PARTNERSHIP DISADVANTAGES
PARTNERS MAY DISAGREE ON DECISIONS.
DECISION OR ACTION OF ONE PARTNER IS LEGALLY BINDING ON OTHER PARTNER.
IF ONE PARTNER DIES, BUSINESS MUST BE REORGANIZED.

8. CORPORATION A BUSINESS OWNED BY STOCKHOLDERS.
A LEGAL ENITY CHARTERED BY THE STATE .
BOARDS, DIRECTORS, AND OFFICERS MANAGE THE DAILY OPERATIONS OF A CORPORATION.
(MICROSOFT)

9. CORPORATION TYPES
PRIVATE (CLOSED): DO NOT OFFER SHARES OF STOCK TO THE PUBLIC.
PUBLIC (OPEN): SHARES OF STOCK OFFERED TO THE PUBLIC.

10. CORPORATION ADVANTAGES
DELEGATION OF SPECIFIC MANAGEMENT SKILLS.
LIMITED LIABILITY TO STOCKHOLDERS.
EASIER TO SECURE CAPITAL.
STOCHOLDERS CAN EASILTY ENTER OR LEAVE THE BUSINESS.

11. CORPORATION DISADVANTAGES
GOVERNMENT REGULATIONS.
COMPLEX TO STARTUP AND DISSOLVE.
DOUBLE TAXATION.
CORPORATION
STOCKHOLDERS
COMPLEX RECORD KEEPING

12. LIMITED LIABILITY COMPANY (LLC)
COMBINATION OF PARTNERSHIP AND CORPORATION.

13. LIMITED LIABILITY COMPANY ADVANTAGES
PASS-THROUGH TAXATION
EARNINGS TAXED ONLY ONCE.
SIMILAR TO PARTNERSHIP.
LIMITED LIABILITY (OWNERS ARE NOT INDIVIDUALLY RESPONSIBLE FOR THE DEBTS OF LLC)
FLEXIBILITY IN STRUCTURE AND MANAGEMENTOF THE BUSINESS.

14. LIMITED LIABILITY COMPANY DISADVANTAGES
EXPENSE TO STARTUP.
EXTENSIVE RECORD KEEPING.
IF MEMBER LEAVES, IT CAN DISOLVE THE LLC.