COMM 103 Chapter Notes - Chapter 13: Initial Public Offering, Limited Liability Partnership, Legal Personality

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Document Summary

Chapter 13: introduction to capital and financial markets. The 5 key factors which influence legal structure decisions: ease of setup and operation, degree of control that an owner desires, required skills for success, financial capacity required, magnitude of risk that individuals are willing to take on. Sole proprietorships - business that is owned by one person and that is initiated without a requirement to create a separate legal entity. High magnitude of risk (owner has 100% personal liability) Limited to the financial resources of the owner. Limited to the sill set and business competencies of the owner. Partnerships - is a business organization that is formed by two or more individuals. Partnership agreement: written agreement among the partners that outlines the expectations of each partner and details how the partnership is going to work. Joint and several liability: refers to the liability obligation of partners as the result of a legal contract.

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