MGTA01H3 Chapter 4: Chapter 4

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MGTA01H3 Full Course Notes
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MGTA01H3 Full Course Notes
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Document Summary

Chapter 4 understanding legal forms of business organization. Four options are available: the sole proprietorship, the partnership, the corporation, and the cooperative. The sole proprietorship is a business owned and operated by one person. Majority of businesses in canada are sole proprietorships yet this form of ownership accounts for only a small portion of total business revenues. Tax benefits the losses can be deducted from income the proprietor earns from personal source other than the business. Unlimited liability personal liability for all debts of the business. Hard to borrow money to start up or expand. Lack of continuity the business legally dissolves when the owner dies. A partnership is formed when two or more persons operate a business for profit. General partnership is a type of partnership in which all partners are jointly liable for the obligations of the business.