BUSN 110 Chapter Notes - Chapter 6: Independent Business, Franchise Tax, Franchise Disclosure Document
Document Summary
Chapter 6: business formation- choosing the form that fits. Forms of business ownership: sole proprietorship: single owner who manages the company, partnership: voluntary agreement between two or more co-owners of a business for profit. General partnership: all partners can take an active role in managing the business and have unlimited liability for claims against them: corporation: business is considered a legal entity, separate and distinct from its owners. Articles of incorporation: establishes the existence of a new corporation. Limited liability: owners are not personally liable for claims against their firm and their personal assets are protected: limited liability company (llc): offers limited liability to owners and flexible tax treatment. Advantages: ease of formation, retention of control, pride of ownership, retention of profits, possible tax advantage. Disadvantages: limited financial resources, unlimited liability, limited liability to attract and maintain talented employees, heavy workload and responsibilities, lack of permanence.
