BELLRINGER ON YOUR ½ SHEET

1. Describe a time when you were injured at a business, or might have been injured.

Why are Entrepreneurs important?2 reasons

Say you want to become…

Risk vs. Reward How likely is my business to cause harm?

Liability Responsibility for risks

Sole Proprietorship Single person 2 positives, 2 negatives Good for: low liability, low entry costs Benefits: single person has all control and keeps

all profits Drawbacks: single person assumes all risk, hard to raise capital

Examples: small construction firms, artistic firms, bloggers, import/export

Partnerships

Two or more people in business together 2 positives, 2 negatives

Good for: low liability Benefits: low entry costs, shared costs Drawbacks: partners assume all risk hard to raise capital, agreements “like a marriage”

Examples: law firms, small specialized firms

Subway page 218

Liability

If your Sole Proprietorship or Partnership is sued…

They can take:Your houseYour carYour money in the bankYour future money!!!

What happens if? New

Restaurant!!!

Corporation A legal “person” Good for: higher liability Benefits: owners protected easier to raise capital Drawbacks: double taxation increased regulation

Examples: restaurants, LLC’s, Sports Franchises

Double taxation Corporation pays its own taxes: 25-35% Corporation pays employees wages/salary Employees ALSO pay taxes: 20-38%

Trade off is less liability more tax

2 types of Corporations

Privately held – owned by founders or owners

Publicly held – owned by shareholders

#2 OPTIC graph on page 220

CorporationsPartnershipsSole Proprietorships

On a full sheetBellringer

1. OPTIC for this graph

Source: Forbes Magazine 2011

Which of the 3 business orgs would you use to start a…..

Which of the 3 business orgs would you use to start a…..

Which of the 3 business orgs would you use to start a…..

Which of the 3 business orgs would you use to start a…..

Which of the 3 business orgs would you use to start a…..

Tile setting

Which of the 3 business orgs would you use to start a…..

Which of the 3 business orgs would you use to start a…..

Which of the 3 business orgs would you use to start a…..

Which of the 3 business orgs would you use to start a…..

Business Org Closure Pages 220-2232. How hard would it be to file articles of incorporation

in the state of Arizona?3. What is the difference between common and

preferred stock?4. Explain how double taxation works.5. What would you have to do if you wanted to open a

Subway franchise?6. Compare and contrast the advantages of owning a

franchise like a Subway. 3 for each7. Which business organization should you use to

open a restaurant? & why?8. Which business organization should you use to

open a computer tech company? & why?QE. Find an entrepreneur in the book who you could admire and

explain what you could learn from them. (list on page “x”)