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Business Ownership (sole proprietorship (A business that is owned by one…
Business Ownership
sole proprietorship
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Most advantages of sole proprietorship arise from the 2 main characteristics of simplicity and individual control
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Sole Proprietorship
Easy to Start and End- Sole Proprietorship is the simplest and easiest to start. When you want to close the company its easy you don't need to pay any extra experiences plus very little paperwork.
Pleasure Of Ownership-A individual successful in Sole Proprietorship is proud of their work. They were able to solve problems on a everyday basis.
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Strong Profit Gain- Since they created the business they get to keep most of the profit they make. If the company is successful the more money they make
Less Taxes- Every business has to pay taxes but since they created sole proprietorship they don't have to pay taxes to state and federal income tax
You are your own Boss- You can make up the hours, locations, pay, etc.
Disadvantages
Larger Debt- You are the owner so that means any money you overspent( Debt) so you need to pay it all off when your company closes or when they ask you to.
May not last forever- If the owner of the business dies, or retires the business stops existing.
Money Issues- Banks are unwilling to give large amounts of money to Sole Proprietorship because the business may not be successful and it will take them longer to get the money back. Plus if they don't get the money( the business starters) they are unable to start their business.
Less Management Skills- The Sole Proprietorship is usually the Manger. In being the manager they need to know how to be the salesperson, buyer, accountant. Some individuals are unable to do this.
Harder Time To get Employees- Since you are barely starting your company you may have not of made a big name of yourself, as a result of this is it is harder to get employees. Plus they start of with low wages because you haven't made a lot of money yet.
Partnership
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In 1990, Janet Smith and Gary Smith started IVY Planning Group Company.
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Corporations
Forming a Corporation
Corporate Ownership- When a corporation forms it might sell stocks to the public or other corporations. When a corporation sell stocks to only a few people they are know as a Closed Corporation. When a corporation sell stocks to the public they are know as a Open Corporation.
- Proprietorship, partner ship, corporate, or some special form of worship
- Partnership agreement
- Incorporating a business
- Registering stock
- Trade mark, patent, or copy right
- Licenses or permanents at the local, state and federal level
- Purchasing existing business or real estate
- Creating valid contracts
- Employees independent contractors
- Credit and collecting debt
Articled of Incorporation
- Name a address
- Incorporators' names and address
- Purpose of corporation
- Maximum amount of stock, types of stock to be issued
- Rights and privleges of stock holders
- Lengnth of time to the corporation is to exist
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organizational meeting- meeting where incorporates and original stockholders elect the first board directors. This which board members are in charge of the stockholders operate the firm.
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