Management and Organizational Studies 2275A/B Chapter 14: Chapter 14

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

Document Summary

Sole proprietorship: an unincorporated business organization that has only one owner. It is the simplest form of business organization because there is no legislation pertaining to the sole proprietorship as such. It is the owner who must repay all loans; the owner is responsible for debt. It is their personal assets which are subject to the death of the business: the owner has unrestricted legal liability and responsibility of obligations. Profit sharing: all profits after taxes are directed to the owner, the profit motive is strong in this type of business because all profits are directed to the individual. Decision-making: the individual has all personal freedom to do exactly as he or she pleases, the sole proprietorship has a limited lifespan, the sole proprietor is responsible for every aspect of the business. Sources of capital: the owner is limited to their own assets and whatever credit they can draw on to finance the operation.