LAW 122 Midterm: Law122 Test #2 Notes (Ch 7-9, 21)

• School: Ryerson University
• Department: Law and Business
• Course: LAW 122
• Professor: Clara Chapdelaine- Feliciati

Document Summary

Types of business organizations: sole proprietorships, general partnerships, limited partnerships, limited liability partnerships (llp, corporations. Liability and benefits of entrepreneurs and other stakeholders differ depending on type used. Arises once a person begins to conduct business: e(cid:454)a(cid:373)ple: ta(cid:396)t (cid:272)utti(cid:374)g so(cid:373)eo(cid:374)e"s la(cid:449)(cid:374) fo(cid:396) (cid:373)o(cid:374)e(cid:455) No separation between business and proprietor (owner): proprietor entitled to all income, proprietor liable for all obligations, p(cid:396)op(cid:396)ieto(cid:396)"s assets a(cid:448)aila(cid:271)le fo(cid:396) (cid:271)usi(cid:374)ess de(cid:271)ts, business income (loss) on personal income, proprietor cannot be employee of business. As business grows, these problems continue to grow. Conclusion: a sole proprietor is best suited for small businesses. No fo(cid:396)(cid:373)al (cid:396)egist(cid:396)atio(cid:374) as a (cid:862)sole p(cid:396)op(cid:396)ieto(cid:396)ship(cid:863) is (cid:396)e(cid:395)ui(cid:396)ed. (cid:894)co(cid:373)e this to incorporation, where formal steps are required. ) Legal test: exists when: two or more people, carry on business together, with a view to profit. Remember: there are no formal requirements for creating a partnership.