Module 1 Flashcards
(33 cards)
is an organization that uses economic
resources or inputs to provide goods or services to customers in exchange for money or for other goods and services.
Business
also known as single proprietorship
SOLE PROPRIETORSHIP
business owned by only one person who
has complete control and authority of its
own.
SOLE PROPRIETORSHIP
it owns all the assets and personally
answers all liabilities or losses. This
implies that the creditors of the business
may go after the personal assets of the
owner should the business fail to pay
them.
SOLE PROPRIETORSHIP
least costly among all forms of
ownership
usually adopted by small business
entities.
Sole proprietorship
- Ease of formation and dissolution
- Low start-up cost and low operational
overhead - Typically, subject to fewer regulations
- No corporate income taxes
Advantage of Sole proprietorship
Types of business that is usually use sole
proprietorship. Give at least 3.,
- Bookkeeping
- Home Healthcare
- Financial Planner
- Landscaper
- Computer Repair Services
- Catering Company
- Housecleaning Services
- Freelance Writer
- Tutoring
- Virtual Assistant
is a business owned by two or more
persons who bind themselves to
contribute money or industry to a
common fund with the intention of living
the profits between themselves
Partnership
________ _________means that it has
a personality distinct and
separate from that of its
members.
juridical identity
- Synergy resulting from two or more
individuals combining strengths - Easy to form but requires developing a
partnership agreement - Subject to fewer regulations compared
to corporations - Stronger potential of access to greater
amounts of capital - No corporate income tax.
advantages of partnership
- Unlimited liability where general
partners are individually responsible for
the obligations of the business - Limited life with the withdrawal or death
of a partner as reasons to end
partnership. - Real possibility of disputes or conflicts
between partners that may lead to
dissolve the partnership.
Disadvantage of Partnership
- Edison Electric Light Co.
- The Wright Co.
- Warner Bros.
- Parfums Chanel
- Hewlett-Packard
- Mc Donald’s
- Microsoft
- Apple
- Ben & Jerry’s Home made
Famous business PARTNERSHIS that became successful and became part of the world history
is a business organization that has a
separate legal personality from its
owners
CORPORATION
established by or composed of at least 5
natural persons and not exceeding 15
persons, technically called
“_________”
CORPORATION, incorporators
board of directors, who controls the
activities of the corporation, is elected
from the stockholders.
the liability of the shareholders of a
corporation is restricted to the amount
of capital they contributed
personal assets of stockholders are not
attached to pay the corporation’s
liabilities, though the responsible
members may be held personally liable
in some instances.
CORPORATION
is a situation in
which courts put aside limited
liability and hold a corporation’s
shareholders or directors
personally liable for the
corporation’s actions or debts.
Doctrine of piercing the
corporate veil
- Unlimited commercial life because
corporation is an entity of its own and
does not dissolve when ownership
changes. - Greater flexibility in raising capital
through the sales of stock. - Ease of transferring ownership by selling
stock. - Limited liability
Advantage of corporation
- Regulatory restrictions which can be
costly - Higher organizational and operational
costs - Double taxation referring to income
taxes that are paid twice on the same
source of earned income.
Examples of corporations that have started ou
Disadvantage of corporation
is a duly registered business organization
owned by a group of individuals and is
operated for their mutual benefit.
Cooperative
Some examples are:
1. Water and Electricity (utility)
cooperatives
2. Cooperative banking
3. Credit Unions, and
4. Housing Cooperatives
examples of cooperative
Money, Control, Adventure, Security
Purpose of establishing a business
there is a big opportunity to earn
far more money for successful
business people if they are
working under their own
business.
business means that a person
can earn without depending on
his own ability to succeed and
excel in the marketplace.
MONEY
Business allows for a more
personal control of an owner’s
financial future.
confident people are often
happier when running their own
business, even with the enlarges
risks, responsibilities and
stresses.
Control
adventurous people may find
excitement of the marketplace
irresistible.
these people will pursue their
own businesses basically for the
adventure, regardless of how
much profit they will likely gain
adventure
