Business Organizations

Sole Proprietorship

The sole proprietorship is their simplest business form under which one can operate a business.

Example: A new entrepreneur starting a business, you'll need to decide early-on which type of business entity you'll set up.


An association of two or more people as partners.

Example: Microsoft

Founders: Bill Gates and Paul Allen


A company or group of people authorized to act as a single entity (legally a person) and recognized as such in law.

Example: AT&T

Limited Liability

Limited liability is where a person's financial liability is limited to a fixed sum, most commonly the value of a person's investment in a company or partnership. If a company with limited liability is sued, then the plaintiffs are suing the company, not its owners or investors.

Unlimited Liability

Unlimited liability refers to the legal obligations general partners and sole proprietors because they are liable for all business debts if the business can't pay its liabilities.




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    the goods or merchandise kept on the premises of a business or warehouse and available for sale or distribution.




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    a sum of money paid regularly (typically quarterly) by a company to its shareholders out of its profits (or reserves).

Board of Directors

A board of directors is a body of elected or appointed members who jointly oversee the activities of a company or organization.

Most Common Business

The most common forms of business are the sole proprietorship, partnership, corporation, and S corporation. A Limited Liability Company (LLC) is a relatively new business structure allowed by state statute. Legal and tax considerations enter into selecting a business structure.