Management and Organizational Studies 2275A/B Chapter Notes - Chapter 14: Independent Business, Fiduciary, Legal Personality

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

Document Summary

Choosing how to own a business is a critical decision because it determines in large part who. Sole proprietorship = an unincorporated business organization that has only one owner. Oldest form of business organization and the one most often used by small businesses. From legal perspective - represents simplest form of business organization bc there is no legislation pertaining to sole proprietorship. Financial consequences for a sole proprietorship should be straightforward and significant. Bank loan = if proprietor decides to borrow money form bank it is the sp who promises to repay the loan no his business. If business falters and cannot repay the loan, bank will take legal steps to recover as much of the debt as possible. All of his business and personal assets are subject to the debts of he business. All judgments against him will be kept alive unless he declares bankruptcy. Making it close to impossible to start another venture.