Types of Business Ownership 2.01
Lindzie Staton. 2/17/16. 3rd.
There are a few types of partnerships. Those are dormant, general, limited, secret, and silent. You have many specialized corporations. There's sub chapter S, limited liability company, nonprofit corporation, domestic, foreign, alien, public, and private. In sub chapter S treats partner as individuals by taxing them once. Limited liability company provides limited liability for owners. A nonprofit corporation is a group of people who join to do some activity that benefits the public. An example is goodwill. domestic is chartered in a specific state. Foreign is chartered in one state but dong business in another. Alien is chartered in another nation but doing business in a state.Public is established for a governmental purpose. Private is established by individuals for business or charitable purposes.
"Success in business requires training, discipline, and hard work"
Cooperatives are owned by members serves their needs and managed in their interest. They purchase goods and services cheaper as a group. There is greater bargaining power then as individuals. An example is a credit union.
Franchise is permission to operate a business to sell products and services in a set way. It begins with a parent company who owns the product or service and grants the right to another business. An example is Chick Fil-A
Its owned by one or more shareholders and managed by a board of directors. to start a corporation it has to be formed under the laws of the state. The you have to register your business as a corporation and get a permit for it. Advantages is limited liability and ability to generate capital. disadvantages are time and money, and double taxes. They are limited liability. An example is UPS and Dominos. To terminate a corporation the IRS makes you pay taxes. Selects funds that invest in the companies you wan to own.
A partnership is owned by two or more people. There are five different types of partners. A dormant partner plays no role and is not not known to the public. General partners plays and active role and have unlimited liability. Limited partners do not have an active role and are known to the public. Secret partners are active and are unknown to the public. Silent partners are not active and are known to the public. Management depends on the partnership agreement. You get more capital and credit and you also have combine resources . But, you have to share profits and are responsible for each others decisions. Partnerships have unlimited liability. An example is Skype. If a partner dies or retires then the partnership will be terminated. You could always get a small business loan and use personal savings to invest in a partnership.
A sole proprietorship is owned by one person. The manager could be the the owner. You do not have to take any formal or legal at the state level. You will have to register your business and occupancy licence. Advantages of this business is that you are the boss and you keep all the profits but, you're taxed as one person and your capacity to raise capital is limited. Your liability is unlimited. Example will vary. To terminate is determined by the owner. Borrowed money and gifts are sources of investment.