BUSINESS OWNERSHIP

TYPES OF BUSINESS OWNERSHIP

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BUSINESS OWNERSHIP by Mind Map: BUSINESS OWNERSHIP

1. SOLE PROPRIETORSHIP

1.1. ADVANTAGES

1.1.1. ease and cost of formation

1.1.2. use of profits

1.1.3. flexibility and control

1.1.4. very little government regulations

1.1.5. secrecy

1.1.6. ease of ending the business

1.2. DISADVANTAGES

1.2.1. unlimited liability

1.2.2. limited sources of financing

1.2.3. limited skills

1.2.4. limited lifespan

2. PARTNERSHIP

2.1. GENERAL PARTNERSHIP

2.2. LIMITED PARTNERSHIP

2.3. ADVANTAGES

2.3.1. ease of organization

2.3.2. combined knowledge and skills

2.3.3. greater availability of financing

2.3.4. very little government regulations

2.4. DISADVANTAGES

2.4.1. unlimited liability

2.4.2. reconciling partner disagreements and action

2.4.3. sharing of profits

2.4.4. limited lifespan

3. CORPORATIONS

3.1. ADVANTAGES

3.1.1. Limited liability

3.1.2. Easier to raise capital due to greater sources of funding

3.2. DISADVANTAGES

3.2.1. Being taxed twice (as a legal entity and as an owner)

3.2.2. Greater Government regulations to adhere to

3.2.3. More expensive to set up

3.2.4. Extensive record keeping required