Business: What is a Sole Proprietorship?

A sole proprietorship is a business owned by one person. This is the simplest type of business to start and is the least regulated form of organization. A sole priprietor performs most of the major tasks and functions such as overall manager, sales manager, and finance manager. The owner not only retains the revenue and title to all of the business’s assets, such as profits, but is also responsible for all losses, debts, and aliabilites incurred. Although a sole proprietorship must comply with all required licenses and permits necessary for its type of business to operate legally, there is no legal requirment to start the business operation. Since the proprietor is the sole owner of the business, there is generally no need for any agreements or formalities. Terminating a sole propriotorship can be done by the owners choice and is limited to the owners life span considering once that person passes away, so does the sole propriotorship.

A partnership is very similar to a sole proprietorship except that that there are two of more owners. It is defined as a voluntary association of two or more persons to carry on as co-owners in a lawful business for profit. The people involved in the partnership are called the partners and they are considered agents rather than employees of the partnership. The way partnership gains and losses are split are described in the partnership agreement. This agreement can be an informal oral agreement or a lengthy, formal written document. There are a few types of partnerships. A general partnership which is created to carry on a particular kind of business; a special partnership which is created for a single transaction; a trading partnership which is created for buying and selling purposes; and a nontra...

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...ublic corporation which is a private corporation established to provide an important service that the public depends on (for example: Con Ed); a domestic corporation which is established under the laws of a particular state and does business in that state; a foreign corporation which is a corporation formed under the laws of one state and does business in another state; a professional corporation which is organized to carry on a profession; and a non-profit corporation which is established for a charitable purpose and are subject to frequent inspection by the government. Also, there is a close corporation which all the shares are held by either one shareholder or a small number of shareholders and a s corporation which if all shareholders consent, they can be treated as partners, keep limited personal liability that a corporation provides and avoid double taxation.