Types of Business Ownership

1074 Words Aug 14th, 2012 5 Pages
1. Sole Proprietorship
Single proprietorship is the simplest form of organization in most of the countries in the world. Unlike other forms of entity, it is usually not governed by special laws. A proprietorship is a type of business entity which legally has no separate existence from its owner. Hence, the limitations of liability enjoyed by a corporation and limited liability partnerships do not apply to sole proprietors. All debts of the business are debts of the owner. The single proprietor has unlimited liability since creditors of his business may proceed not only against the assets and properties of his business but also after his own personal assets and properties. A sole proprietorship essentially refers to a natural person or
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Joint ventures are created in the essence of serving their purposes. They can be composed of a corporation, partnership or an individual.

5 Main Forms of Business Ownership
Sole Proprietorship- A sole proprietorship is owned by only one person. This is the most common form of business ownership.

General Partnership- A business owned by two or more people. The partners share ownership and control of the business.
Limited Partnership- A limited partnership consists of at least one general partner (controls the business) and at least one limited partner(investor).

Forming a Corporation- A corporation is a business which is considered a separate entity from you; even having the legal rights of a person. There are two types of corporations; C Corporations and S Corporations.

Limited Liability Company- The new “It” thing in the world of entrepreneurship. It’s popularity has been steadily growing in the past years. What attracts entrepreneurs to this business structure is that it provides the limited liability provided by corporations with out all the restrictions and taxes.

Business activities may be divided into three kinds: 1. Industry 2. Commerce 3. Services
This classification is based on the nature of principal activity performed by the business enterprise. 1. Industries involve the conversion of raw materials into finished products or goods and the application of labor upon raw materials so that greater usefulness becomes