Business Administration 1220E Chapter Notes -Sole Proprietorship

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24 Apr 2012

School

Western University

Department

Business Administration

Course

Business Administration 1220E

Professor

Poulopoulos

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Business Administration 1220E Full Course Notes

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Document Summary

A business owned and usually operated by a single individual. The proprietor takes ownership of the company"s profitability and assets but also assumes fill responsibility for the company"s losses and debts. There are minimal legal requirements and often minimal capital requirements. It can terminate should the owner become disabled, die, or file for bankruptcy. Offers the owner freedom and flexibility in making decisions easily and quickly. Since there are no others to consult, the owner has absolute control over the use of the company"s resources. They might experience difficulties obtaining capital because lenders might not trust such a small business. Might be difficult to attract employees because there are few opportunities for advancement, minimal fringe benefits, and little employee security. Unincorporated enterprise owned by two or more individuals. A partnership agreement expresses the right and obligations of each partner.

Related Questions

In a sole proprietorship, the profits earned by the business are:

A. taxed as income for the business, but exempt from the personal income tax paid by the owner.

B. taxed at the lowest corporate rate.

C. the property of the owner, except for taxes owed to the government.

D. tax-free if the appropriate exemption is filed with the local government.

orangehound90

Partnerships refer to more than one owner. A limited partnership ______________.
a) consists of general partners and limited partners, at least one of each
b) is a shadow firm for a much larger corporation. It is like a shell company to dispose of risky assets
c) is taxed similar to a corporation, whereas a general partnership is taxed like a sole proprietorship
d) is limited by the number of partners allowed. There can only be a total of 10 partners actively involved in the business