entity concept applies to all forms of businesses – single proprietorship‚ a partnership‚ and a corporation. A single (sole) proprietorship is business owned by an individual and often managed by that same individual. Single proprietors include physicians‚ lawyers‚ electricians‚ and other people who are ‘in business for themselves’. In a single proprietorship‚ the owner is responsible for all debts of the business. Operating as a proprietorship is the easiest way to get started in a business activity
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Sole Proprietorship Liability- Owner is liable for 100% of debts‚ taxes and liabilities. Income Taxes- Taxed like regular income tax; owner claims it at year end and pays income tax on all earnings. Longevity/Continuity- Company will likely die off if owner does. The company‚ being one and the same as the owner‚ cannot continue without measures being taken to pass on Control- Owner has complete control over all decisions made; complete autonomy Profit Retention- All profit belongs
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1 SOLE PROPRIETORSHIP: The owner and the business are considered one. The owner takes all the risk and receives all the profits. It is easy and inexpensive to start up a sole proprietorship however a sole owner has trouble raising capital which could limit growth. • LIABILITY –If the business fails the owner is financially responsible and my lose everything. • INCOME TAXES – The proprietor and the business are taxed together. • LONGEVITY/CONTINUITY – The business dies with the sole proprietor
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Some of these business organizations include; sole proprietors‚ corporations‚ and partnerships. With choosing which organization to go with one must consider consequences in lieu of legal issues‚ taxes‚ financial statements‚ and accounting practices. A new business venture will be summarized along with the business organization type and related consequences regarding different business types. Types of legal business entities Sole Proprietorship This type of organization is one of the most
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scenarios will be formed to demonstrate the different forms of business such as Sole Proprietorship‚ Partnership‚ Limited Liability Partnership‚ Limited Liability Company‚ S Corporation‚ Franchise and Corporate Form. Sole proprietorship is defined by an individual or a married couple who is responsible for the day-to-day operation of the business. As the easiest way to form and run a business‚ sole proprietorship allows the business owner(s) to have ownership of all the business assets and profits
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Principles of Finance HW# 1 Question# 1-1: If you bought a share of stock‚ what would you expect to receive‚ when would you expect to receive it‚ and would you be certain that your expectations would be met? Answer: If I bought a share of stock‚ I would expect to receive a share of the company. Meaning either to vote in the company or receive paid dividends‚ depending on if I purchased common or preferred stock. I would expect to receive my share instantly. I would not be certain that my expectations
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organizations to meet the needs of today’s economy. There are different forms of organizations and choosing the correct one is important‚ as it will affect the success or failure of the business. Define the Different Forms of Business Organizations Sole proprietorships are an individually owned business where the individual is entitled to all of the profits and also responsible for all of its debts‚ liabilities‚ taxes‚ and claims that may be made toward the organization. Partnerships are businesses started
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Chapter 3 - NATURE OF FINANCIAL MANAGEMENT What is finance Finance can be defined as he art and science of managing money. Virtually all individuals and organizations earn or raise money and spend or invest money. Finance is concerned with the process‚ institutions‚ markets and instruments involved in the transfer of money among individuals‚ business and governments. Nature of Financial Management Financial Management as an academic discipline has undergone fundamental changes as regard
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ADVANTAGES OF HAVING A PRIVATE LIMITED COMPANY AS BUSINESS ORGANISATION Unlike proprietorships and partnerships‚ private limited companies enjoy certain exemptions and privileges‚ which are peculiar to their constitution and nature. A private limited company is variously described as‚ ëquasi-partnershipí‚ ëfamily concerní‚ ëclose corporationí etc. A private limited company also has many advantages over proprietorships and partnerships‚ as elaborated below. 1. Limited Liability First and
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This article is about Wendy Ho‚ the Mary Chia Holdings chief executive‚ has been credited with spicing up the brand’s image‚ deciding to take it out of the heartland and into the realm of the exotic. This article reinforces the concept of Sole-Proprietorship (ref: Unit 2 Types of Business). Mary Chia Holdings is owned and controlled by just one person although it may have many employees. It is the oldest and most common form of business ownership. Not only that‚ it is also the easiest form of business
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