General partners are those who are responsible for the day-to-day management of activities, whose individual acts are binding on all the partners, and who are personally responsible for the partnership's total liabilities. Limited partners are those who contribute only money and are not involved in management decisions and whose liability is limited to the amount of their investment.
Joint Venture Joint Venture acts like a general partnership, but is clearly for a limited period or a single project. If the partners in a joint venture repeat the activity, they will be recognized as an ongoing partnership and will have to file as such, and distribute accumulated partnership assets upon dissolution of the entity.
Advantages of a A corporation may deduct the cost of benefits it provides to officers and employees. Can elect S corporation status if certain requirements are met. This election enables company to be taxed similar to a partnership.
Disadvantages of a Corporation The process of incorporation requires more time and money than other forms of organization. Corporations are monitored by federal, state and some local agencies, and as a result may have more paperwork to comply with regulations. Incorporating may result in higher overall taxes. Dividends paid to shareholders are not deductible form business income, thus this income can be taxed twice
Conclusions There are essentially three basic ways to set up your business as summarized in paragraph below.
Sole proprietorships Sole proprietorship is a form of business organization in which an individual is fully and personally responsible for all the obligations of the business, and is entitled to all of its profits and exercises complete managerial control. The person who owned this form of business is called as a sole proprietor or sole trader.
Partnerships A form of business in which two or more persons join their money and skills in conducting the business. Normally there can be a minimum of two and a maximum of twenty partners to form a partnership. Most people
Related Documents: Advantages And Disadvantages Of A Joint Venture
LIT1: Task 310.1.2-01-06 Task A Sole proprietorship 1. Liability * An owner has unlimited liability both personally and as the company owner. Liability is a disadvantage in a sole proprietorship. 2. Income taxes * The owner is responsible for filing taxes and is allowed to file taxes as part of their personal income taxes. 3. Longevity * This depends completely on the owner and there continued ability to operate the business. The operation of the business can be significantly…
LIT1 Task 1 Part A SOLE PROPRIETORSHIP Sole proprietorship is the most common form of business in the United States. A sole proprietorship is a business that is owned by one person. Sole proprietorships have the following characteristics: 1. LIABILITY- There is no difference between the belongings of the business and the business owner. The business owner can use his/her personal money or business money to pay off any debts whether they are personal or business related. Therefore, sole proprietorship…
LIT1 Task 310.1.2-01-06 Part A Sole Proprietorship: It’s one owner that is no required to register the business. But, it would have to register their business if it requires specific materials or if the owner opens the business under another name. An advantage is that the owner can write off some expenses when doing taxes, it is a simple business to open, run and maintain. The business can be also taxed as a “single unite” and they make all decision with complete control. A disadvantage is…
LIT1 Task 1A 1/10/2014 Sole proprietorship: Is the simplest and most common business structure. There is no legal distinction between the proprietor and the business, which means it is autonomous. You are entitled to all profits and responsible for all your business's losses and liabilities. Liability- This falls directly on the owner. All debts, liabilities and losses fall on the owner. The owner's assets can be used to alleviate the business's debt. Income taxes- All income generated…
"PART A (THE REPORT)" SOLE PROPRIETARY OWNERSHIP The Sole proprietorship is the most basic way that a single person can own and operate a business it basically refers to a single person ownership of a business and that they are entirely responsible for the business along with any financial, legal or tax ramifications incurred by the business. In a sole proprietorship the owner usually chooses to operate under a fictitious name or (DBA), like “Joes Bar and Grille”. The DBA is simply a trade name—and…
When you have completed this topic you will be able to accomplish the following: • Describe the characteristics of a sole proprietorship, general partnership, limited partnership, limited liability company, sub-chapter S corporation, and C corporation • Differentiate between a sole proprietorship, general partnership, limited partnership, limited liability company, sub-chapter S corporation, and C corporation as an appropriate form of business organization in a given business situation • Explain…
This paper will discuss the six most common forms of business organizations is the United States, explaining their individual characteristics, advantages and disadvantages. Hopefully this will allow you to make an informed decision about the direction that would be most advantageous to grow your current business. Sole Proprietorship Your current business is a sole proprietorship which is the most common of all the forms of businesses is the United States today. This type of business usually has…
Legal Issues in Business Organizations Task 1 Zachary Christenson Western Governors University 000447824 Family and Medical Leave Act Situation The Family and Medical Leave Act of 1993 (FMLA) was created to help assist employees deal with the difficulties of home, while creating an atmosphere of job security. The FMLA also helps cover employers from wrongful use of the FMLA by the employees. Although the document is extensive, there are three major provisions of the FMLA that apply to the…
LIT1 – Task 1 (Part A) Sole Proprietorship: * Single Ownership - The single individual always owns sole proprietorship form of the business. The individual owns all assets and properties of the business and bears the risk of losing or gaining from the business. * No Sharing of Profit – The business is owned by an individual, therefore, all of the gains are directly available for the owner to access immediately. There is no friction between owners * One Man’s Control - The controlling…
LIT1: Legal Issues for Business Organizations When evaluating your current situation, I thought it was best to just lay out to you all of your options, with the pros and cons to each. After detailing each specific type of corporation option, I will provide you with my final analysis which will be included in the memorandum that follows all of the given information. If you have any questions or comments for me, please just reply to the memo and we will schedule a sit down talk, where…