Management and Organizational Studies 2275A/B Chapter Notes - Chapter 14: Air Miles, Cover Version, Net Income

• School: Western University
• Department: Management and Organizational Studies
• Course: Management and Organizational Studies 2275A/B
• Professor: Frederick King

Document Summary

Adam is in debt of over 10k and only has a compsci degree and a car worth 15k as his only assets. He has an idea to manufacturer a product that betters computers. His father is willing to i(cid:374)(cid:448)est (cid:1005)(cid:1004)(cid:1004)k a(cid:374)d a (cid:373)a(cid:374)ufa(cid:272)turer"s age(cid:374)t is (cid:449)illi(cid:374)g to i(cid:374)(cid:448)est (cid:1006)(cid:1004)k. Choosing how to own a business is a critical decision because it determines in large part who: Is financially liable for the business: shares in business profits and other assets, makes and is accountable for management decisions. An unincorporated business organization that has only one owner. Oldest and simplest form of business organization: simplest because there is no legislation pertaining to the sole proprietorship. Any obligations become personal obligations: bank loan: adam is the business and he is the debtor so he has to repay the loan. Unlimited liability unrestricted legal responsibility for obligations. All the profits after taxes accrue to the sole proprietor alone.