MGTA01H3 Chapter Notes - Chapter 4: Chief Executive Officer, Limited Liability, Legal Personality
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MGTA01H3 Full Course Notes
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Chapter 4 notes: understanding legal forms of business. Organizing options: sole proprietorship, partnership, corporation, cooperative. Sole proprietorship: a business owned and operated by one person: an extension of the owner (not a separate entity) Personal liability for all debts of the business. Tax losses can be offset against other income resources depend on the proprietor. Partnership: a form of organization established when two or more persons agree to combine their financial, managerial, and technical abilities for the purpose of operating a business for profit. 2 types of partnerships: general partnerships and limited partnerships. Limited partnerships: a type of partnership with at least one general partner (who has unlimited liability) and one or more limited partners. The limited partners cannot participate in the day-to-day management of the business or they risk the loss of their limited liability status. Page | 1: allow investors some protection. 2 kinds of partners: general and limited partners.