© 2009 The McGraw-Hill Companies, Inc. All rights reserved. 4 McGraw-Hill Sole Proprietorships One...
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Transcript of © 2009 The McGraw-Hill Companies, Inc. All rights reserved. 4 McGraw-Hill Sole Proprietorships One...
© 2009 The McGraw-Hill Companies, Inc. All rights reserved.
1
McGraw-Hill
Sole Proprietorships• One person
• Advantages– Easy to start, easy out; you are your our own boss;
you retain all profit; and no special federal taxes
• Disadvantages– Limited financial resources; skill gaps; unlimited
liability; lack of fringe benefits; a limited lifespan
Types of Business Ownership
© 2009 The McGraw-Hill Companies, Inc. All rights reserved.
2
McGraw-Hill
Partnerships• General partnership• Limited partnership
– General partner– Limited partner– Limited liability
• Master limited partnership (MLP)• Limited liability partnership (LLP)
Types of Business Ownership
© 2009 The McGraw-Hill Companies, Inc. All rights reserved.
3
McGraw-Hill
Partnerships• Advantages:
– More financial resources and pooled knowledge
• Disadvantages– Division of profits; unlimited liability for each general
partner; conflicts among partners; difficult to get out of the relationship
Types of Business Ownership
© 2009 The McGraw-Hill Companies, Inc. All rights reserved.
4
McGraw-Hill
Corporations• Corporate governance• Board of directors
C-Corporations– Owners not liable for debts
S-Corporations– Government created, taxed like sole proprietor
Limited Liability Corporations (LLCs)– Ownership rules are flexible; cannot sell stock;
more paperwork; double taxation
Types of Business Ownership