Lecture 4

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Published on 17 Jun 2011
School
UTSC
Department
Management (MGT)
Course
MGTA01H3
Professor
MGTA03IntrotoManagementLecture4
Chapter4:FormsofBusinessOrganization
MainPointsthisLecture:
SoleProprietorship
Partnerships
Corporations
Intro
CanadaÆFreemarketeconomy
Entrepreneursneednopermission,fees,forms

SoleProprietorship
Easiestwaytoformbusiness
Mostcommonformofownership
Youaresoleproprietors
Businessrunby1person,whomakesalldecisions,keepsallprofits,andresponsibleforalldebts
Advantages
Easytosetup;norequirements,noaccountingneeds
Cheaptosetup;$60r$70ifregistered,$0ifnotregistered(doesn’tneedtoberegistered)
Disadvantages
Limitstoowner’sskillsandresources
Hardtogetloans
Personalandunlimitedliability
Partnership
Businessowned/operatedby2+peopleactingtogether
Advantages
2+heads
Moreresources,credibility,andcontacts
Disadvantages
Personal,Unlimited,Jointandseveralliability
(JointandseveralliabilityÆallpartnersresponsibleforanydebts)
PartnershipAgreements
Agreementbetweenpartners,whichincludes;amountofmoneyeachpartnercontributed,the
responsibilitiesofeachpartner,howpartnersarepaid,andprofitsaredistributed.
Betweenpartners,andnotbindingonothers
GeneralPartnership
Simplestform
Allpartners; shareownership
Sharemanagement
Unlimitedandpersonalliabilitiesfordebts
www.notesolution.com
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