201 Types of Business Ownership

By: Katlynn Harmon 2-17-2016 POBF

Special Types of Ownership



  • Sub-Chapter - treats partners as individuals by taxing them once
  • Limited Liability Company- provides limited liability for owners
  • Non-Profit Corporation- a group of people who join others to do one activity in the public (salvation army)
  • Cooperatives- Owned by members and serves needs
  • Franchise-permission to operate a business but have to sell products in a set way (Ex:Subway,Wendy's, Burger King)

Corporation

  • Owned by one or more share holders
  • Managed by the board of Directors
  • They file with the article of incorporation with the state government
  • 2 advantages: Easy to obtain capital and limited liability for shareholders
  • 2 disadvantages: Double taxation and decision making are shared among managers
  • Unlimited Liability for a lifetime
  • Ex: American Red Cross
  • Ownership cant be terminated because of unlimited life
  • Stock and bond market

Partnership

  • Two or more people
  • Determined by partnership agreement may be by one or more partners
  • Began by partnership agreement
  • Advantages: work load shared
  • Disadvantages: limited lifetime
  • Terminated by actions of partners
  • Investment: Personals of partner's gifts
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Proprietorship

  • Owned by one person
  • Maybe owned by an owner
  • Begin buying and selling goods and services also may vary by state
  • Advantages: Easy to form
  • Disadvantages: Limited capital
  • Decision or life of owner
  • Personal, gifts, borrowed and others may vary
  • Answers will vary