Types of Businesses

I) Proprietorship A) One individual owns the business –1) Any profit is the owner’s profit. –2) Easy to start –3) Little Gov’t Regulation/Taxes –4) Pride of ownership –5) Complete Control of Decisions

b) Disadvantages 1) Unlimited liability 2) Any loss is the owner’s loss 3) Limited life of the business 4) Difficult to raise money

II) Partnership A) Two or more people share a business –1) Not difficult to raise funds –2) Combination of skills

b) Disadvantages 1) Profits are shared 2) Disagreements

III) Corporation A) A business which is separate from the owners B) Owners hold “stock” or a percentage of the corporation C) Profits are expressed in an increase in the stock (dividends)

d) Advantages 1) Easy to raise funds 2) Limited liability 3) Unlimited life 4) Specialized management 5) Shared risks

e) Disadvantages 1) Less control 2) Double Taxation 3) Difficult to Start 4) Limited Activities