List as many forms of Business ownership you remember from your reading. Sole Proprietorship ❖ ❖ ❖ ❖ ❖ ❖ ❖ ❖ EASY to form Owner keeps all assets Owner gets to make all decisions Owner HAS to make all decisions Owner responsible for all liabilities Unlimited personal liability Difficult to raise capital Low risk Partnership ❖ ❖ ❖ ❖ ❖ ❖ ❖ Relatively easy to form Owners share all assets Owners share decision making Owners responsible for all liabilities Unlimited personal liability (LLP or LP) More sources of capital Low risk Limited Liability Company (LLC) ❖ Relatively easy to form ❖ Increased rules and regulations ❖ Similar to Proprietorship, except with liability protection. ❖ Lower tax than corporation ❖ Must pay self-employment taxes ❖ Limited life Corporation (c-corp) ❖ Legal entity separate from owners - LIMITED personal liability ❖ Require extensive reporting processes/legal requirements ❖ Pay tax on profits and personal tax on dividends ❖ Ease of transition of ownership ❖ Easier to raise capital Franchise ❖ ❖ ❖ ❖ ❖ ❖ ❖ ❖ Buy into existing successful business Low failure rate Turnkey - get everything needed to start Marketing, Buying power, Star power Profits - depends on franchise model MANY RULES Ongoing costs Expense of buy-in Which ownership model would you choose?
