Post on 12-Jan-2016
Business and laborTypes of Businesses
Chapter 19Section 1
Types of BusinessesProprietorships
Sole Proprietorship- A business owned and operated by a sole or single person.
Advantage- Full pride in the owning the business receives all profits.
Disadvantage- Unlimited liability/ Full responsibility
Also difficult to raise financial capital (money needed to run a business or enable it to grow larger)
Types of BusinessesPartnerships
Partnership- A business that two or more people own and operate.
Structure. Articles of Partnership- The document identifies how much money each of you will contribute and what role partner will play in business.
Advantage- Pride in ownership, ability to borrow, diverse talents, and efficient operations.
Disadvantage- Legal structure is complicated and unlimited liability.
Types of Businesses Corporations
Corporation- an organized business recognized by law that has many rights and responsibilities of the individual.
Structure. Charter- A government document granting permission to organize.
- The Charter also specifies the amount stock, or ownership shares of the corporation that will be issued.
Types of BusinessesCorporations Continued
- The people who buy this stock- the stockholders- become part owners of the corporation.
- The stockholders elect a board of directors to act on their behalf.
- Advantage- Ease in raising financial capital and growth
- Disadvantage- Expensive and complex to set up, very little say, more regulated from the government.
Types of BusinessesOther Forms of Business
Franchise- owner is the only seller of a certain product in the right area. Owner pays a fee to the supplier for that right
Non Profit organization Goods and services without
trying to make a profit Public Schools Public Hospitals Labor Unions Boy Scouts/Girl Scouts
Types of Businesses Cooperatives- A voluntary association of people formed to carry on an economic activity.
- Consumer cooperatives buy bulk amounts of goods on behalf of their members. Members donate time to run the operation to keep cost down
https://www.youtube.com/watch?v=pPVkG9krOMI
Types of BusinessesPartnership Both Sole
Proprietorship