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MGTA01H3 (583)
Chapter

MGTA03 Ch 4

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Department
Management (MGT)
Course
MGTA01H3
Professor
Chris Bovaird
Semester
Winter

Description
MGTA03 Ch 4Entrepreneurs must choose a form of legal ownership that best suits their needs Sole proprietorship a business owned and operated by 1 person your business is an extension of yourself and not a separate legal entity Advantages freedom low startup costs easy to form wo extensive paper work tax benefits since the business and the proprietor are legally one and the same businesses losses can be deducted f income the proprietor earns f personal sources other than the business Disadvantages Difficult to borrow money to start and expand managerial resource and financial limitations lack of continuity sole proprietorship legally dissolves when the owner dies unlimited liability personal liabilities for all debts and legal liabilities incurred by the business fuck ups are paid out of the owners own pockets Partnership a form of organization estbd when 2 persons agree to combine their financial managerial and technical abilities for the purpose of operating a business for profit General partnership a type of partnership in which all the partners are jointly liable for the obligations of the business a share in profits management and debt Limited partnership a type of partnership wleast one general partner who has unlimited liability and one or more limited partners The limited partners cannot participate in the daytoday management of the business or they risk the loss of their limited liability statusGeneral partners partners who are actively involved in managing the firm and have unlimited liabilityLimited partners partners who dont participate actively in the business and whose liability is limited to the amount they invested in the partnershipAdvantages ability to grow by adding talent and money easier to borrow funds can invite new partners to join by investing money simple to
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