1. Types of business organizations
STANDARD CE.12a

2. What are the basic types of business structures?
Proprietorship
Partnership
Corporation

3. Proprietorship

4. Proprietorship
A form of business organization with one owner who takes all the risks and all the profits.

8. Proprietorship Pros Easy Complete control Cons Unlimited liability
Difficult to raise money

9. Number of Businesses PARTNERSHIPS 7% CORPORATIONS 20%
PROPRIETORSHIPS 73%

10. Partnership

11. Partnership
A form of business organization with two or more owners who share the risks and the profits.

15. Partnership Pros Can raise more money Help with control Cons
Legal structure complex
Unlimited liability

16. Corporation

17. Corporation
A form of business organization that is authorized by law to act as a legal person regardless of the number of owners. Owners share the profits. Owner liability is limited to the amount of their investment

18. Corporation Pros Can raise even more money Limited Liability Cons
Expensive and complex
Very little control
More regulation

19. Sales
PARTNERSHIPS 5%
PROPRIETORSHIPS 6%
CORPORATIONS 89%

20. Entrepreneurs play an important role in all three business organizations.

21. What is an entrepreneur?
A person who takes a risk to produce goods and services in search of profit.
HARLAN SANDERS
RAY KROC

22. May establish a business according to any of the three types of organizational structures.

31. QUIZ

32. How many basic ways can businesses organize to earn profits?
d. 4

33. Who plays an important role in all three business organizations?
a. Governors
b. Presidents
c. Entrepreneurs
d. Magistrates

34. A form of business organization with one owner who takes all the risks and all the profits is called a—
a. Proprietorship
b. Partnership
c. Corporation
d. Governorship

35. A form of business organization with two or more owners who share the risks and the profits is called —
a. Proprietorship
b. Corporation
c. Partnership
d. Wholesale

36. Which of the following is not a basic type of business ownership?
a. Proprietorship
b. Retail
c. Corporation
d. Partnership

37. a. Corporation b. Proprietorship c. Partnership d. Distributor
A form of business organization that is authorized by law to act as a legal person regardless of the number of owners is called a —
a. Corporation
b. Proprietorship
c. Partnership
d. Distributor

38. In a corporation, the owners share the profits, but liability is limited to —
a. investment
b. distribution
c. retribution
d. theft

39. A person who takes a risk to produce goods and services in search of profit is called —
a. an entrepreneur
b. a privateer
c. a profiteer
d. a flight risk