Business Organization

by Willie Moody

3 Types of Business Organization

Someone, who is the one and only owner, takes all of the risks in the business and receive all the profits. This is known as sole proprietorship. Partnerships divide the risks and profits of business among 2 or more people. Corporations shares shares stocks with investors,

Examples

A sole proprietorship is similar to being assigned work, because all the work you are assigned is done by only you and you are the only to recieve the grade you get.

Partnerships would be splitting payments for a phone bill, because if one person messes up for a month the whole contract is messed up.

Corporations share stocks with investors just like Burger King share stocks with their investors.

Definitions

Limited liability- The shareholders profit rises and falls when the corporations rises and falls, but he shareholder loses less of value of the corporation rather then losing as much as the business.

Unlimited liability-all risks and profit belong to one person.

Board of Directors- run the corporation

dividends- their share of the profits.

stock- goods or merchandise kept on the premises of a business and available for sale

Most Common Business?

Sole proprietorship is the most common business, because most people like to be independent. Even though it has a high risk, it has a high profit