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MGTA01H3 Chapter 4: Chapter 4 study notes

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plumoyster166
30 Jan 2011
School
UTSC
Department
Management (MGT)
Course
MGTA01H3
Professor
Chris Bovaird

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MGTA01H3 Full Course Notes
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MGTA01H3 Full Course Notes
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Document Summary

There are usually 4 types of legal ownership for businesses: A business owned and operated by one person. Freedom: don"t need to answer to anyone but themselves. simple legal setup: registration is not required. Tax benefits: losses in early stages can be deducted from income (one legal entity). Lack of continuity: legally dissolves when owner dies. unlimited liability: personal liability for all debts of the business. depends of resources of one person (managerial and financial limitations) 2 or more persons agree to combine money, managerial and technical abilities to operate a business for profit. able to invite new partners to join business (ability to grow by adding talent and money) Taxed as individuals (not regarded as legal entities) difficulty in transferring ownership: may not sell out without other partners". Lack of continuity (even if only one partner pulls out/dies) consent.

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Related Questions

17) Gilbert is considering setting up a business. He likes some of the advantages of sole proprietorships, but is concerned about some of the disadvantages. He should consider all of the following except: a) c) difficulty in getting bank loans unlimited liability difficulty of liquidation limited managerial and financial resources difficulty of passing the business on to his heirs e)

17) Your friend Paul is considering starting a web-page development business. He asks you about the features of sole proprietorship, as a form of business organisation. In discussing the costs and benefits you should tell Paul about all of the following except: a) b) It may be difficult for a sole proprietorship to obtain a bank loan As a sole proprietor, Paul should be concerned about unlimited liability As a sole proprietor, it may be difficult for Paul to close down his business As a sole proprietor, Paul must deal with limited managerial and financial resources d)

32) Small businesses: a) b) c) d) cannot begin as a business corporations must begin as either sole proprietorships or partnerships must begin as a sole proprietorships can begin as business corporations, sole proprietorships, or partnerships