which income from the business' taxation, the ability to raise fund to finance the business, and the legal liability of the owners. There are four different types of business structures; sole proprietorship, partnerships, corporations, and Limited Liability Partnership (LLP) (Parrino, Kidwell & Bites, 2012). Start-ups and small business perform as either sole proprietorship or partnerships because of the small operating scale and capital requirements. However, the larger a firm grows, the greater
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LIT 1 Task 1 PART A Sole Proprietorship Sole Proprietorship is a business owned by one person, as distinguished from a partnership or Corporation. Sole proprietorship is a company, which is not registered with the state as a limited liability company or corporation. Some advantages of a sole proprietorship are that they have flexibility in operations. The sole proprietorship business is undertaken on a small scale. If any change is required in the operations, it is easy and quick to bring the
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| The Criteria That Determine Sole Proprietorships | Not all corporations started as a corporate entity. Many businesses start out small with one owner. They are known as sole proprietorships, the simplest and most widespread form of business formation in the United States. Certain criteria are used to determine sole proprietorship status. A sole proprietorship: * is owned by a single individual When you are planning to do business with a sole proprietorship, bear in mind that since a single
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are partnership, limited liability company, sole proprietorship, limited liability partnership, franchise, s corporation, and corporate form. Legal Forms of Business Paper Sole proprietorship is often preferred by individuals who are seeking to maintain managerial control. Ventures such as a small coffee shop, small restaurant, or a small store are good candidates for sole proprietorship. All of these generally have a low overhead, and are very unlikely to face liable issues. A sole proprietorship
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Forms of Business Ownership There are basically four ways to organize a business. • Sole Proprietorship • Partnership • Corporation 1.Sole Proprietorship A sole proprietorship, also known as the sole trader or simply a proprietorship, is a type of business entity that is owned and run by one individual and in which there is no legal distinction between the owner and the business. The sole proprietor form of business ownership is the most common form in the United States and also the simplest. In
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Sole Proprietorship BUS 311: Business Law 7 Jul 2014 Sole Proprietorship Upon the decision to start a new business, one must ask the question of what type of business entity they intend to initiate. According to Rodgers, Author of the book Essentials of Business Law, “One of the most fundamental decisions all businesspersons face in starting a business is how that business will be organized,” (2012). There are several deferent business entities to choose from. The business owner would have
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1 Part A 1. Sole proprietorship: This type of business is known to be the easiest business for an individual to develop. A sole proprietorship is owned by one person, who is the person that will make the decisions in regards to the business and does not share any responsibilities with anyone else as the business owner. • Liability: One person is liable for the debts of this type of business, this will include their personal assets if necessary. • Income Taxes: Sole proprietorship is taxed as
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organization such as: * Liability: who is responsible and are there limits to liability? * Income taxes: how are taxes paid? * Longevity or continuity of the organization: how to or what dissolves an organization? * Profit retention: how is profit divided? * Location (expansion): how are location or expansion decisions made? * Convenience or burden (compliance): how difficult is it to comply with regulatory requirements? Sole proprietorship Sole proprietorships are easy to form,
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for their needs. Whether the business will be a sole proprietorship, partnership, limited liability company (LLC) or corporation, it depends on the type of business, how many owners it has, and its financial situation. There is no one choice that suits every business situation. This paper analyses several of the most important factors to be considered when deciding in regard to the business structure, including: • Potential risks and liabilities of the business • Formalities and expenses
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Sole Proprietorship The sole proprietorship is the simplest business form under which one can operate a business. The sole proprietorship is not a legal entity. It simply refers to a person who owns the business and is personally responsible for its debts. A sole proprietorship can operate under the name of its owner or it can do business under a fictitious name, The fictitious name is simply a trade name--it does not create a legal entity separate from the sole proprietor owner. Formation The simplest
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