1. Business Structures How can businesses be legally organized?

2. Basic Structures Sole Proprietorship Partnership Corporation

3. Sole Proprietorship One owner Profits and risk are taken by only one person

4. Partnership Two or more people own the business Partners share the profit and risks Partners may divide business how they decide

5. Corporation Many owners Owners hold stock or shares Investors may or may not “work” for the company

7. Sole Proprietorship Advantages Keep all profits Manage without approval from others Quick decisions can be made Freedom to operate business as you want Single tax Disadvantages Risks are all yours Unlimited liability (you are responsible for all debt and all problems Personal assets are at risk Business and owner are seen as one and the same Difficult to raise money to start

8. Partnership Advantages Others can help with decision making Each partner can do what they are good at to help the business Risk is shared Liability is shared Easier to raise money to start Disadvantages Must make decisions with others approval Disagreements can happen Profits must be shared Less freedom to manage it as YOU want More complicated legally to set up

9. Corporation Advantages Easy to raise money by selling stock Limited liability (you only risk what you invest) Personal assets not at risk Easy to transfer ownership Disadvantages Difficult to manage the company as YOU wish Many people to answer to Legally complicated to set up Profits shared by many Double tax