MGTA01H3 Chapter Notes - Chapter 4: Chief Executive Officer, Limited Liability, Legal Personality
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MGTA01H3 Full Course Notes
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Sole proprietorship: a business owned and operated by one person: advantages. Answer to no one but themselves since they don"t share ownership. Tax benefits, all profits are all going towards the owner: disadvantages. Unlimited liability: personal liability for all debts of the business. Lack of continuity: once the owner dies, te business legally dissolves. Depends on the resources of one person, whose managerial and financial limitations may constrain the bussines. Ability to grow by adding talent and money. Abilitiy to invite partners to join by investing : disadvantages. Lack of continuity (when a partner dies or pulls out, a paternership dissolves legally even if the other partners agree to stay) Transferring ownership (no partner may sell out without the other partners consent) Little or no guidance in resolving conflict between the partners. Public corporation: a business whose shares are widely held and abailable for sale to the general public. Can also go private, which is the reverse of going public.