GRA 741 Lecture Notes - Lecture 2: Limited Liability Partnership, Sole Proprietorship, Double Taxation
18 Sep 2012
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Cons: unlimited liability if debt have to pay out of their own pockets. If the owner dies, family inherits it, but have to start a new business. Someone who owns 51% of the shares, the person of company will make decisions. Pros: limited liability (only liable for the amount you put in) Cons: limited liability people can"t make decisions. At least one person with unlimited liability. All employees are limited liability and owns the company. How to choose: initial cost, liability, tax considerations, the image the entrepreneur wishes to project, the number of investors and their nancial circumstances. Milestones: prove your concept, complete design speci cations, finish a prototype, raise capital, ship a testable version to customers, ship the nal version to customers, achieve break even. Assumptions: product or service performance metrics, market size, gross margin, sales calls per salesperson, conversion rate of prospects to customers, length of sales cycle, etc. (aos - p. 17-18)
