In the world we live in today lawsuits are prevalent and being sued by someone could cause the business to fold. It would be wise for one to obtain all the knowledge before starting a business and it is a reason why people use the term “knowledge is power” (Clarkson & Miller, 2012). As individuals, when we lack knowledge we perform practices unknowingly which could lead to major lawsuits. Ownership of a business can be formed as sole proprietorship, partnership, or corporation. Potential great profit is the reason most people want to start and some do start corporations. One must have knowledge, and understand business law in order to have a positive outcome with operating an organization (Clarkson & Miller, 2012).
Many people desire to
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The owners are all responsible for the financial obligation of the company. Legally the owners are responsible for the amount of money invested by one (Seaquist, 2012). With this partnership if one of the partners is negligent in ones dealings and the other owners are not, all would be held liable and accountable for the negligent actions of the one owner (2012).
Limited partners are not liable for partnership obligations. The partner’s risk ones agreed capital contribution, or whatever is stipulated in the partnership agreement. If a partner decides to operate the business, then one may lose the protected limited partner status and be held liable for all risk (Limited Partnership, 2012).
Limited liability corporations protect the owners from personal liability and can be established informally. This form does involve some of the features of the other forms of business (Lair, 2013). Many small business owners chose LLCs because it is easy to form and offers protection to the owner. Instead of the owner being liable for the corporation, the corporation is liable (2013).
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The breach is without legal excuse. A breach of contract occurs when obligations are not met that were agreed upon by people or companies (Breach of Contract, 2014). When one fails to honor the contract it becomes a breach in contract. To limit the liability within each organization one should complete any pending contracts, and negotiate with contracting party to compensate for the unfulfilled contract. Breaching parties have to pay punitive damages which are a form of punishment for not honoring the legal contract
Corporation – “A business organization that exists as a legal entity and provides limited liability to its owners.” (Longenecker, Petty, Palich, Hoy, Pg. 205) The main advantage of a corporation is that the business liability falls onto this entity instead of the individuals that own it. The disadvantages of this organization are found mostly in its formation. A corporation is expensive to create and requires compliance with state
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A corporation was originally designed to allow for the forming of a group to get a single project done, after which it would be disbanded. At the end of the Civil War, the 14th amendment was passed in order to protect the rights of former slaves. At this point, corporate lawyers worked to define a corporation as a “person,” granting them the right to life, liberty and property. Ever since this distinction was made, corporations have become bigger and bigger, controlling many aspects of the economy and the lives of Americans. Corporations are not good for America because they outsource jobs, they lie and deceive, and they knowingly make and sell products that can harm people and animals, all in order to raise profits.
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find it difficult to set up a business and make it a success. This is
When it comes to business, especially when it comes to starting one, I tend to think I know it all. Yet in reality, I don't really even know how to get started, enough to make a business efficient, or even get the doors open enough to make the first dollar. When I first think of working/operating a business, I think of no boss but myself, the rules are made by me and no one else, and that seems like a great plan in my eyes. As well as having all company profit coming directly to me, and I get to decide what happens with it. Although I know there is more to it than that, there is forming a budget, working with customers, knowing when to expand, and when to coast through. I also know that in the world of business, that if you aren't moving ahead, you are moving backwards.