MGM101H5 Chapter Notes - Chapter 4-6: Outsourcing, Leveraged Buyout, Double Taxation

• School: UTM
• Department: Management
• Course: MGM101H5
• Professor: Dave Swanston

Document Summary

The three major forms of business ownership are: (1)sole proprietorships (2)partnerships (3)corporations. One person owning and operating a business, without forming a corporation. The business and the owner are a single entity. Advantages: ease of start/end, be your own boss, pride of ownership. Leave legacy: retain profit, no special taxes, fewer regulations. Disadvantages: unlimited liability, difficulty in mgmt, time commitment. When two or more people legally agree to become co-owners of a business. New types: master limited partnership traded publicly taxed as a partnership, limited liability partnership. Unlimited liability: any debts or damages incurred by the business are your debts, and you must pay them. Meaning if the company fails, files for bankruptcy and you owe debts; then your personal assets can be seized such as your home, car, and contents of your bank accounts to pay off the debts. Limited liability: the responsibility of a business"s owners for losses only up to the amount they invest.