MGM101H5 Chapter Notes - Chapter 5: Sole Proprietorship, Limited Partnership, Double Taxation
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MGM101H5 Full Course Notes
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Document Summary
What are the 3 major forms of business ownership: sole proprietorship, partnership, corporation. Businesses are responsible for paying all normal debts and pay: because of a court order, because of a law, for performance under a contract, for damages to a person or property. What are the 2 types of liabilities: unlimited liability. Owners may have to sell personal assets (car, home, etc) to pay for company"s debt: limited liability. Owner"s responsibility for losses is limited to the money they invest. Business owned and operated by one person without forming a corporation. The individual and company are one entity. Net assets can be passed down: possibly pay higher taxes - compared to some corporate rates but some leases and contracts cannot. A legal form of business with 2 or more parties. Partnership of individuals, corporations, trusts, other partnerships, or a combination of these. All owners share in operating the business and in assuming liability for the business"s debts.
