There are four main forms of business structures. The structures of business differentiate based on liability, tax implications, and what type of business is being evaluated when determining what structure to use. This paper will cover the advantages and disadvantages within the four types of business structures; Limited Liability Corporations, Corporations, Partnerships, and Sole Proprietorships.…
Which of the following is an advantage of corporations relative to partnerships and sole proprietorships?…
Question 2.2. Which of the following could explain why a business might choose to organize as a corporation rather than as a sole proprietorship or a partnership? (Points : 6)…
2. The primary factor that separates the corporate form of business from partnerships and sole proprietorships is:…
Companies are fall into one of three categories; a proprietorship or sole proprietorship is a business owned by one individual. A partnership exists when two or more persons associate to conduct a business. In contrast, a corporation is a legal entity created by a state. In our current economic system corporation share some of the same benefits as individuals; although Sarbanes Oxley law has made some significant changes, corporations are still viewed as separate and distinct from its owners and managers. In a limited partnership, limited partners’ liabilities, investment returns and control are limited, while general partners have unlimited liability company (LLC), combines the limited liability advantage of a corporation with tax advantage of a corporation with tax advantages of a partnership. A professional corporation (PC), known is some states as a professional association (PA), has most of the benefits of incorporation but the participants are not relieved of professional (malpractice) liability.…
A partnership, sole proprietorship, and incorporation are three types of business ownership. (Miller 444) Sole proprietorships can be operated and owned by the same person. Then again, an entrepreneur may claim sole proprietorships; however they may acquire a supervisor to run the business daily routine. The sole proprietor tracks every profit made from the business and is responsible for any losses that may occur. Of the three types of ownership, the sole proprietorship is the most demanding. When considering a business one of the crucial starting points should be the registration and business name. (Miller 445) The name…
Advantages of proprietorships are that they in cheaper to start up, they have few government regulations, and no corporate income tax. Some disadvantages are they often acquire a lot of debt and are limited to last only as long as the person who created it.…
Partnership advantages- the same persons who own the business also manage the business, It can begin with a verbal or written agreement. Disadvantages- Each partner may be held liable for all the debts of the partnership and for the actions of each partner within the scope of the business.…
A partnership as a form of ownership is formed quite simply. When two or more people get together and come to an agreement on what type of business to take part in, then all parties share investment, profit, and of course loss. Let’s discuss the pros and cons of a partnership.…
One disadvantage of operating as a corporation rather than as a partnership is that corporate shareholders are exposed to more personal liability than partners.…
* When starting a business one of the first steps to determine is what form of ownership will your business be. There are three different types of ownership, the first one being the most simplest and popular; sole proprietorship. This form of ownership is where one person has the overall say on what goes on in the company as far as financial and business decisions. The next is a partnership in which two or more people co-own a business for the purpose of making a profit. In this form of ownership there is a big factor of trust that has to be there between the two business owners. The finally for of ownership is a corporation which is the most complex of the three forms. A corporation is an artificial legal entity created by the state that can sue or be sued…
A Partnership shares every aspect of the business (investment, business decisions, profits, and losses) equally with few formalities. Partnerships are relatively easy to start because there is more capital available. It is recommended to have…
The partnership has two or more people and has the advantages and disadvantages are similar to the proprietorship. One disadvantage is that the partners can lose their assets even if they are not tied to the business unless a limited partnership is done (Ehrhardt & Bringham, 2011).…
Sonic is the largest drive-in chain in the United States. Under the slogan "America's Drive-In," a Sonic features fast service by roller-skating carhops and unique menu items that cannot be found at McDonalds, Burger King, or Wendys. Sonic restaurants operate in 27 states so it is smaller than leading fast food chains however it is still a significant competitor. Founded by Troy Smith and Charlie Pappe in 1953, Sonic went from a single root beer stand to a popular franchise. In 1973, Sonic restructured as a franchise company and later became Sonic Corporation. The company experienced financial decline due to the lack of consistency from its franchisees so they were bought out by Sonic Corporation and restructured. In 1995, Sonic introduced "Sonic 2000," an aggressive multi-layered strategy to further unify the company in terms of a consistent menu, brand identity, products, packaging, and service. The campaign was successful and Sonic's brand recognition increased. Strengths include a strong competitive nature, flexible strategies, and employee/franchisor relationships. Weaknesses include lack of communication and domestic expansion. Threats in the external environment include company size, employee turnover, weak economy, rivals in similar industries, overseas expansion, and slow growth markets. Sonic can overcome these threats with opportunities such as global expansion, increase in the number of quick service consumers, and appealing investment opportunities. Alternative strategies and recommendations suggest that Sonic should concentrate on a low cost strategy and focusing on niches such as the health food market.…
When comparing Sonic (America’s Drive Inn), and McDonald’s patrons would “be” surprised to know that these two restaurants are the same in many ways, but their different at the same time. Although McDonald’s and Sonic sell similar food items they both have many differences in store design, menus, and customer service. Sonic Restaurants gives customers a feeling like attending a drive inn movie or a skating rink; whereas in McDonald’s Restaurants there is a golden arch shaped like the letter “m” on the name board outside the restaurant, and in the inside there is a clown picture of Ronald McDonald on the wall. Inside McDonald’s Restaurant are tables and chairs where the customer can sit down and eat inside. Some McDonald’s offers a play land for children. Patrons also can give their child’s birthday party there. Both restaurants are popular in the fast food industry. They both cater to the same type of customers and offer somewhat similar food items. For instance, Sonic has the Brown Bag Meal deal for $8.99, and McDonald’s has the two Big Mac Sandwiches combo for $10. McDonald’s is popular for its WI-FI connection in their stores. McDonald’s showcase their restaurants as clean, comfortable, and welcoming. It seems to me they are trying to stay in tune with the customer lifestyle. As for Sonic Restaurants they went from a root beer stand to a popular franchise overnight. Statistics show that Sonic has become the largest drive inn chain in the United States.…