Acc 561 Week 2 Paper - 1305 Words

Running Head: Four Types of Business Brandon Mckinley University of Phoenix ACC/561 Introduction An Entrepreneur is a person who forms and operates a business. Entrepreneurs form and start companies by themselves, or with partners. Most of the time companies which are started by entrepreneurs are relatively small in size, but some grow into huge corporations, such as Microsoft which is owned by Bill Gates. Entrepreneurs have four different options when starting a business, which include a sole proprietorship, Partnership, limited liability company, and also a corporation. Each form has its advantages and also disadvantages depending on what the type of business is, and also what service it provides. Sole Proprietorship†¦show more content†¦Other advantages of corporations include that they have a ranking of officers that run the company from the CEO, to the CFO and down to the next chief officer. Also, corporations are taxed at the corporate level using corporate income tax rates filed under the form 1120. Another advantage of a corporation is that if a corporation becomes insolvent, its owners and shareholders will not be liable beyond their equity investments in the corporation – creditors cannot go after the stockholders’ personal assets to exhaust their debts.(Advantages, 2009) One of the last advantages of a corporation is that if they are publicly traded, shareholders are able to sale their stock through stockbrokers. Disadvantages of corporations include that sometimes they are double taxed. If dividends are paid out from the corporation to stockholders, then those stockholders are taxed on their personal income tax returns also. The last disadvanta ge is that since it is managed by chief officers, stockholders are not able to make any managerial decisions as far as the company is concerned. Limited Liability Company The last of the four types includes the limited liability company, also known as a LLC. An LLC is an unincorporated form of business that carries characteristics of all of the other three forms of business. An LLC can choose to be taxed as a partnership, the owners can manage the business, and the owners have limited liability for debts and obligations of the partnership. LLC’s areShow MoreRelatedFour Forms of Business Organization 21360 Words   |  6 PagesAcc/561 Week 2 Assignment Instructor: Mark Student: G Toe Washington November 14, 2011 Abstract This is an analysis of the four different forms of business organization. It is a review of the advantagesRead MoreStr 581 Essay1954 Words   |  8 Pages†¢ Review the Week One Study Guide. †¢ Review the Capstone Examination Study Materials. Jul, 09 - Jul, 15 Objectives Mission, Vision, and Values 1.1 1.2 1.3 Identify major components of a strategic management process. 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