A sole proprietorship refers to a form of organization owned by a single individual. In this business, a single person makes all the decisions and does not have to engage a legal department to approve contracts. The owner of such a business can only use personal funds even though he or she may have separate checking and savings accounts for the business. The first characteristic of this form of business enterprise is liability. A sole proprietor suffers from unlimited liability. The owner becomes liable personally for all the obligations and debts of the business.
The second characteristic is income taxes. Businesses pay federal income tax just like individuals. In a sole proprietorship, the owner pays income tax only once on the business income, which he or she reports on their personal income form. The third characteristic is control. In a sole proprietorship, the owner makes all the decisions concerning the business. In this business, the owner does not have to grant control to other people. The fourth characteristic is profit retention. If a sole proprietorship makes profits, the money belongs exclusively to the owner.
The reason is that the owner and the business are one. The fifth is location. The owner can move or expand the business to a different state without consulting anybody. This is because the owner is the sole decision maker. The sixth characteristic is convenience or burden. The owner makes sure that the business complies with all meeting, reporting, and other regulatory requirements. There are many advantages in sole proprietorships. First, a sole proprietorship is easy to form. The owner simply starts doing business, providing goods or services, and charging money.
The Term Paper on Sole Proprietorship 2
Sole proprietorships are the most common type of business in the U.S. They are most commonly chosen because they are the easiest type of business to set up and give the sole owner of the company complete control of the company. There are many benefits to a sole proprietorship in regards to control, profit retention, and convenience. In regards to control, the owner of a sole proprietorship has the ...
In addition, the owner gets to make all the decisions concerning the business. In a sole proprietorship business, the owner has to provide necessary documents for the business to be registered. This includes documents such as personal financial statements since the owner and the business are the same thing. Some of the disadvantages associated with a sole proprietorship are that it can be difficult to raise working capital. A sole proprietor faces unlimited liability. He or she is liable for all debts and obligations of the business. General Partnership
A general partnership refers to an associated of two or more individuals in an unincorporated entity to carry out business, as well as share profits and losses (Flat World Knowledge, 2013).
The first characteristic that applies to this form of business organization is liability. Each partner in a general partnership is severally and jointly liable for the debts and obligations of the partnership. The second characteristic is income tax. A general partnership faces the same taxation as a sole proprietorship. Income comes from the business and goes to the partners involved. They then pay the usual income tax on the income of the business.
The third characteristic is control. In the general partnership, all partners have an equal voice in the management of the business. However, they can modify this as they wish through a contract. The fourth characteristic is profit retention. All the profits in a general partnership are shared equally among the partners. In addition, the partners also share losses equally should they occur. The fifth characteristic is location. To move or expand the business into a different state, all the partners have to come to a mutual agreement. Just like a sole proprietorship, there is no legal involvement in the partnership.
The document required to relocate the business are a signed document showing that all the partners have consented to the relocation. This assures that the interests of all the partners are met. The sixth characteristic is convenience or burden. Just like a sole proprietorship, there are no additional requirements or extra workload placed upon the business to comply with all reporting, meetings, among others. The advantages of a general partnership are that all profits and losses are shared equally among the partners. All the partners have an equal voice in the management of a business unless they agree otherwise on the contract.
The Essay on The Business Proposal of the General Agency
The Business Proposal of the General Agency of Korean Morning Glory in Mainland China Preface: At first, we want to let you know that our proposal isn’t based on a new corporation. It was finished on selling products from an overseas company called Morning Glory, which is a very famous company, specialized in stationary, in South Korea. You may not know about the company, but if I mention the Blue ...
The disadvantages of a general partnership are that sometimes it becomes difficult to value the share of a withdrawing business partner. Another disadvantage is that all partners are liable for the debts and obligations of the business. For example, a partner may be innocent about a wrongdoing committed by another partner. However, they are still liable for that partner’s malpractice (SkillSoft Corporation2, 2002).
Limited Partnership A limited partnership is a partnership that has both limited and general partners. A limited partner enjoys limited liability in the partnership.
The most limited partner can lose is only his investment into the business and nothing else. These partnerships are formed in a compliance to state law. The first characteristic that applies to this form of business is liability. In a limited partnership, the limited partner enjoys limited liability while the unlimited partners have unlimited liability. The second characteristic is income taxes. A limited partnership is not a taxable entity. The obligation of income tax to limited partners does not go beyond their original contribution, and they cannot deduct business losses from their income.
In the absence of a limited partner, the business will deal with an agent appointed by the limited partner before his or her death. This assures that the rights of the limited partner are catered for. The third characteristic is control. In a limited partnership, the unlimited partners are the ones who make decisions towards the day to day running of the business. A limited partner invests his or her money in the business but is not involved in the day to day management of the business. The unlimited partners make the decisions on how the business will run.
The Business plan on E Corporation And Their Business Models
E-Corporation and their Business Model Selling businesses, products or services has become much more complex through the Internet. As Hugh Patis sion mentioned, The E-Corporation - Competition today is not between products, it's between business models. This explains the complexity of the whole marketing of a product or service via net. Which way is more efficient, cheaper, updated, or which model ...
The limited partners run the business and give the profits to the unlimited partners. The fourth characteristic is profit retention. Profits from a limited partnership do not face taxation twice. A limited partnership is not taxable, and all profits go to the partners and are taxed once depending on the tax rate of each partner. The fifth characteristic is longevity and continuity of the organization. Continuity depends on the partnership agreement. The partnership has the right to choose its longevity or continuity. If a partner leaves the others can decide to buy the value of that partner or dissolve the partnership fully.
In cases where other partners decide to buy the value of a partner who has left the partnership, they must agree on new terms that the business will have. The unlimited partners decide on the terms of expanding or relocating the business. The sixth characteristic is location. The unlimited partners decide whether to move or expand the business. This is because they are the decision makers in the business. A limited partnership has advantages and disadvantages. An advantage is that a limited partner can only lose the amount they have invested in the business.
A disadvantage is that it places the burden on the unlimited partners because they are the ones who take the losses if they occur. In case a limited partner dies, the next of kin takes over as a partner. The person would have to sign a new agreement to recognize his or her status in the business (Flat World Knowledge, 2013).
C-Corporation A C-Corporation refers to a legal entity that offers limited liability to shareholders for corporate liability or debts while protecting the personal assets belonging to the shareholder. There are two types of corporations.
There are those owned by a family or a small group, and those whose stock trades or sells in the stock markets (SkillSoft Corporation, 2002).
The first characteristic that applies to this form of business is liability. A C-Corporation provides limited liability to shareholders for its liability and debts. The corporation is corporately liable while the shareholder is personally liable. The second characteristic is income taxes. The income of a C-Corporation is taxed twice. A corporation files tax returns and pays taxes on its income. In addition, the shareholders pay personal tax on the divided income from the corporation.
The Business plan on Management Ability Business Company Corporations
With the growing number of corporations taking over small businesses, and the belief that becoming a proprietor is associated with being wealthy, one must decide which type of business to become involved with. There are several differences between these two types of business. A corporation is a business organization having a continuous existence independent of its members (owners) and power and ...
The third characteristic is longevity or continuity of the organization. Once a C-Corporation forms, it can indefinitely with or without the founding stockholders. This means that new managers can come into the business and continue from where the founders had left. The fourth characteristic is control. Boards of directors, who are normally shareholders with large stakes in the company, manage the C-Corporation. These members make the decisions because as majority shareholders, they should be responsible of how the business conducts its day to day activities. The fifth characteristic is profit retention.
Profit retention in a C-Corporation is less than that of a general partnership. This is because the corporation faces double taxation. Shareholders pay taxes on dividend income from the corporation while the corporation pays taxes on its income. The sixth characteristic is location. In case the C-Corporation wants to move or expand, the board of governors makes that decision. The board has the right to make the decision on location because they are the majority shareholders. The C-Corporation has advantages and disadvantages. An advantage is that the C-Corporation can exist indefinitely with or without the original founders.
A disadvantage is that the C-Corporation faces double taxation. Another disadvantage is that it is difficult to form a C-Corporation because of the many regulatory requirements. S-Corporation An S-Corporation refers to a legal entity offering the limited liability of a corporation. The corporation usually has between one and one hundred shareholders and passes net income or losses to shareholders in accordance with the revenue codes (Flat World Knowledge, 2013).
The first characteristic that applies to this form of business is liability. The corporation gives its shareholders limited liability for its debt.
The second characteristic is income taxes. The corporation is not a taxable entity and does not pay taxes on its income, unlike the C-Corporation. Income passes from the corporation to the shareholders who then pay taxes on their income based on their individual rates. The third characteristic is longevity or continuity of the organization. Once the S-Corporation forms, it can exist indefinitely with or without the original founders. The fourth characteristic is control. Board of directors manages the S-Corporation, and they are usually shareholders with a large stake in the company.
The Business plan on Bank Overdraft Business Pay Interest
Part 1 Business and finance 1. If you want to buy an existing business you have to pay some extra money to recognise the work done by the previews owners, the existing costumer base and the reputation of the business. The combined value of these represents goodwill. 2.The purchase of stock- trade credit is probably the best option but a bank overdraft could be used. Renovations that will cost $50, ...
This gives them control of the business, making them the decision makers. The fifth characteristic is profit retention. The corporation is not a taxable entity. All profits and losses go to the shareholders and are taxed once based on the tax rate of an individual shareholder (SkillSoft Corporation2, 2002).
The sixth characteristic is location. In case the company wants to expand or move to another state, the board of directors makes that decision. This power comes to them because they are the majority shareholders and they decide the route that the business should take. The S-Corporation has advantages and disadvantages.
An advantage is that it does not pay tax. The shareholders pay tax based on their individual rates. A disadvantage is that an S-Corporation is difficult to form because of the many regulatory requirements. Limited Liability Corporation A Limited Liability Corporation is a legal entity, which is similar to an S-Corporation. This is because it offers the tax advantages of a partnership, and the limited liabilities of a corporation. The first characteristic that applies to this form of business is liability. The corporation protects the personal assets of its members as well as offering the members limited liability of the company’s debt.
The second characteristic is income tax. The corporation is not a taxable entity and therefore does not pay taxes on its income. Income passes through to the members, who then pay taxes once depending on their tax bracket. The third characteristic is longevity or continuity of the organization. Once the corporation is formed, it can exist indefinitely. However, this varies depending on the regulations each state regarding limited liability corporations. The fourth characteristic is control. Board of directors manages the corporation. They are usually members who have a large financial interest in the company.
The Business plan on Exxon Mobile Corporation Mobil Business Stock
Exxon and Mobil were two big competitors in the oil industry. In the 20 th century, Exxon and Mobil operated with relatively low-price, and in low-margin environments. The market in the United States and Europe have grown and matured, allowing them both to grow with great success. The competitiveness has tightened worldwide in the crude oil business. Both companies have continued to advance new ...
Being a member with a large financial interest in the company puts one in the decision making table of the business. This is because a member with the most shares would lose out in case the business collapsed. The fifth characteristic is profit retention. The corporation is not a taxable entity and therefore all the profits and losses go to the shareholders. The shareholders pay tax once depending on an individual’s tax rate. The sixth characteristic is location. In cases where the corporation wants to move or expand to another state, the board of directors makes the decision.
The board of directors considers the resources available and decides if it is right to expand the business. To relocate the business, the directors have to get business permits that help in the process. In such cases, it is the state that provides the business permits. The Limited Liability Corporation has advantages and disadvantages. An advantage is that the corporation is not a taxable entity. The shareholders pay tax once depending on the tax rate of an individual. A disadvantage is that the corporation is difficult to form because of the many regulatory requirements