Business Law/531 - Week 2 Assignment

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To begin and ultimately complete this week’s individual assignment, as well as, to fulfill the associated objectives, it was first necessary to thoroughly research and learn about each of the unique forms of businesses described in the course readings delegated to week two of the course syllabus. Further, this involved the detailed analysis of the similarities and differences, as well as, the unique principles and reasons behind each of the business forms, and to do so in a way that eventually allowed one to determine a business scenario that worked best for each form described. In the end, it became quite clear that whether a business takes on the form of a sole proprietorship, general partnership, limited liability partnership, limited liability company, S corporation, corporation, or franchise, it is vitally important, as a business professional or aspiring entrepreneur in today’s marketplace, to understand the strengths, weaknesses, pros, and cons of each and every one of them. With all of this said, this brief research paper will provide the reader with valuable insight on each of these eight forms of businesses, and then proceed to explain what types of situations in today’s business world can best be utilized and consequently achieve that most success.

The first notable form of business in this list is a sole proprietorship. According to the authors of this week’s readings, sole proprietorships hold the distinction of being the simplest type of business to form (Cheeseman, 2010.) Further, the owner of this form of business is indeed the sole proprietor, and therefore, in legal terms, the business itself. Another piece of interesting information is that sole proprietorships currently constitute the single largest common form of business enterprises in the United States today (Cheeseman, 2010). Furthermore, because of the advantages of being quick and easy to get started, ownership having the ultimate authority in all decisions within his or her organization, owners do not have to share any profits with corporate partners or superiors, and there are very few barriers of exist. A sole proprietorship could be an ideal form of business for a “mom and pop” restaurant, where the owners are more focused on doing this the way they want to do things. As opposed to having to adhere to or follow rules or regulations that are not necessarily kosher with the way they have always done things and plan on to continuing to do things far into the future.

A general partnership or ‘ordinary partnership’ is the way of doing business that can be traced back to the beginning of time. Further, a general partnership is classified as “a voluntary association between two or more people with the express purpose of carrying on a business” (Cheeseman, 2010). In most cases, partners are all personally responsible for any debts or obligations that may accrue. The four qualities that must be met for a general partnership to be deemed legal include: 1.) an association of two or more people 2.) carrying on a business 3.) as co-workers 4.) for profit (Cheeseman, 2010). Many times the success of a partnership, such as this, relies very heavily on the strength and commitment each member has to upholding the rules agreed upon as the terms of partnership. To conclude this brief summary of the partnership form of doing business, it is important to mention scenarios where this form of business typically has a high rate of success and vice versa. While there are indeed many cases where partnerships have worked and all individuals involved seem to make money, get along with each other, and enjoy the overall experience. The reality is that the vast number of general partnerships end unsuccessfully. Unfortunately, greed plays a lot into this sad statistic and practices such as what individuals in the industry call, “competing with your own partnership”, and “usurping a partners’ golden opportunity”. Unfortunately the list goes on and on, and leads to...
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