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Published byRosalyn Flynn Modified over 9 years ago
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Sole Proprietorship A business owned and run by one person Makes up about 80% of all businesses
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Advantages Easy to get started Relative ease in managing Quick decision making Doesn’t have to share any profits Does not have to pay business income tax
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Major Weaknesses Unlimited Liability Owner is personally responsible for all losses & debts Difficulty in raising financial capital (money) A minimum # of employees & minimum inventory
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Sole Proprietorships AdvantagesDisadvantages Easy to open or closeLimited Funds Few RegulationsLimited Life Freedom and controlUnlimited Liability Owner keeps profits
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What do large corporations offer to attract new hires? Fringe benefits
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What happens when the owner dies? IT DIES
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Partnership A business jointly owned by 2 or more people
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Advantages Yes They bring ideas & different areas of expertise
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Major Disadvantages Each partner is responsible for the other’s actions It has limited life Potential conflict between partners
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Corporations A business organization recognized by laws as a separate legal entity Charter You are creating a legal entity separate from the people who own it! It can sue and be sued!
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Who owns a corporation? Stockholders (WE DO!)
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Two Duties of the Board of Directors Select a president Keep shareholders informed
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Advantages Ease of raising money The corporations are fully responsible for its debts & obligations The business continues to exist even when ownership changes Selling & buying stock
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Disadvantages Very expensive No Double, Corporate, Personal More government regulations
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http://money.cnn.com/2006/04/07/pf/bestjobs_moneymag_perks/index.htm http://www.youtube.com/watch?v=EjTZF19jBs8 http://www.nbcnews.com/business/best-company- work-2014-2D11732356 http://www.youtube.com/watch?v=j6h-gm01Fb0 Awesome Companies to Work For
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Business Combinations Two reasons why businesses merge: The desire of a business to become larger Efficiency
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Economies of Scale Cost of production falls as the business gets larger Buy in bulk Advertising campaigns Eliminate competition Research & development
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Horizontal Merger Two or more firms that produce the same kind of product
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Vertical Merger When firms involved in different steps of manufacturing come together
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Conglomerate A firm that has at least 4 businesses, each making unrelated products GE
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Philip Morris
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Multinational A large corporation with branches in several countries
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Pros & Cons Increase tax revenue & creating jobs Outsourcing jobs http://www.cbsnews.com/video/watch/?id=4312234n http://www.cbsnews.com/video/watch/?id=4312039n DUBAI INC.
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