9. forms of business organization
TRANSCRIPT
Forms of
Business Organizations
All by yourself?
Sole Proprietorship
Owned by one person
Owner keeps all the profits
Relatively unlimited control
Easy to form
No separation of owner from business
Owner responsible for all debts/liabilities
Business and personal property can be seized
How can I start one?
How can I start one?
Few legal requirements
Can be run from a home, garage, or van
Do you have a friend…
Do you have a friend…
and a good idea?
Partnerships
Owned by two or more people
Share profits equally (unless otherwise agreed upon)
Owners share all the risks equally
Fully liable without limit (similar to a sole proprietorship)
Partnerships
Forming a
Partnership
Partnership Agreement
More difficult than a sole proprietorship
Corporations
Corporations Legal entity/artificial person
Separate from its owners
Corporations Owners risk losing their investments
Owners do not lose personal assets
Harder to form
Corporations State Charter and Organizational Fees
Let’s
Review
Sole Proprietorship Requirements for Organization
Legal Status
Liability
Management
Dissolution
Ease of formation
Duration
None Owner is the business Unlimited Liability Owner decides Owner decides/death Just do it Death or disinterest
Requirements for Organization
Legal Status
Liability
Management
Dissolution
Ease of formation
Duration
Agreement of Parties Owners not a separate entity Unlimited Liability Owner have equal say Owners decides/death/ withdrawal/Bankruptcy Moderately Hard Withdrawal/Bankruptcy
Partnership
Requirements for Organization
Legal Status
Liability
Management
Dissolution
Ease of formation
Duration
State Charter/Org. Fees Separate entity from Owners Limited liability of Shareholders Directors set policy and Appoint officers Does necessarily end Difficult Can be perpetual
Corporations
Any Questions?
Any Questions?
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youtube.com/user/MrTeachingTech
D. Casey Robertson
Resources: http://www.paopen4businessbriefcase.state.pa.us/BStructure/SoleProp.asp
http://www.portal.state.pa.us/portal/server.pt/community/reources/8826/corporation/533420
http://www.portal.state.pa.us/portal/server.pt/community/reources/8826/general_partnership/533421
http://www.dos.state.pa.us/portal/server.pt/community/business-related_boards/13772
http://www.allbusiness.com/business-planning/business-structures-corporations/686-1.html
http://www.dos.state.pa.us/portal/server.pt/community/corporations/12457/forms/571880