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
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