Leonardo Orraca Michelle Aranguren Per.8

Sole Proprietorship The first decision that an entrepreneur must make when starting a new business is to see in what form of business organization best serves their interests.

Business Organization Is an establishment formed to carry on commercial enterprise in others words is a company or firm. Sole Proprietorship  Is a business owned and managed by a single individual.  75% of all small businesses are sole propietorship. 6% U.S sales

Advantages of Sole Proprietorships Ease of Start-up: minimum requirements(authorization, site permit, name) Relatively few regulations Sole receiver of profit: owner gets to keep all profits after paying income taxes. Full control Easy to discontinue

Business License: Authorization to start a business issued by a local government. Zoning Law: law in a city or town that designates separate areas for residency and for business.

Disadvantages of Sole Proprietorship  Unlimited personal liability  Limited access to resources  Lack of permanence Liability: the legally bound obligation to pay debts. Fringe benefit: payment other than wages or salaries. Examples are like health insurance, retirement pay or paid vacation.

Quiz: Ch.8 Sec.1 1. What is a sole proprietorship? 2.Name at least 2 advantages and 2 disadvantages of Sole Proprietorships 3.Fill in the blank: An establishment formed to carry on commercial enterprise is __________________ 4.What’s the percentage of all businesses that are sole proprietorships and what’s the percentage of how much U.S sales they generate? 5. Give two examples of Fringe Benefits that sole proprietorships offer. Define Liability