商务英语 工商导论课件.ppt

Slides by X. Zhang Topics Covered Forms of Business Organizations The Advantages and Disadvantages of Different Business Organizations Objectives of Business Organizations Types of business forms Forms of Business Organizations Sole Proprietorship A business owned and controlled by one person. It is the simplest form of business organization to start and maintain. --- It is not a corporation. Small ventures can be owned and managed by a single individual such as restaurants, street grocery stores, florists, beauty saloons, drug stores etc. ---The business has no existence apart from you, the owner. Its liabilities are your personal liabilities. You undertake the risks of the business for all assets owned, whether used in the business or personally owned. You include the income and expenses of the business on your own tax return. Sole Proprietorship Advantages Ease of Organization - simple to establish (a small fee, a few minutes and procedure) - freer in decision making (compared with other business organizations, more freedom on management and operation) - easy to keep operational and financial secrecy (not necessarily report to shareholders or board) Sole Proprietorship Advantages Subject to fewer government policy - Less tax burden (e.g. in the US the tax rates for sole proprietorship are often half those for corporations) - Exclusive use of profits (being your own boss means being the boss of your own money) Sole Proprietorship Disadvantages Unlimited liability (the owner is personally responsible for all aspects of the business) Limited access to capital (lack of long period relation with banks and less security guarantee mean inability to raise large amounts of money Limited managerial expertise (one field expert does not mean expert in every aspect of business, i.e. marketing, finance, HR, operation etc) Life of the business is limited to the life of the proprietorship (the only way to transfer ownership of a sole proprietor