Six Formd of Business Organizations Essay

Six Formd of Business Organizations Essay

Length: 2637 words (7.5 double-spaced pages)

Rating: Research Papers

Open Document

Essay Preview


TASK A

The following are six forms of business organizations. Each form includes a description of the form and its key characteristics, advantages and disadvantages with respect to the following categories: Liability, Income taxes, Longevity, Control, Profit retention, Location (Expansion) and Convenience.

(a1) SOLE PROPRIETORSHIP:

An unincorporated business with a single person as an owner. Generally the sole proprietor acts as chief manager in all aspects of the business, but may employee others to run the business. Due to its single owner nature, agreements and formalities are not necessary. A sole proprietorship is simple to set up and affords the owner a high degree of autonomy, certain tax benefits and full ownership of profits. These benefits are balanced against the fact that the sole proprietor's financial resources are limited to the owners savings and credit. There is no distinction between the owner's business and personal assets and liabilities. A failure in business could lead to creditor's coming after the owners personal assets.
• Liability: The owner is personally liable. No line between business and personal liability exists.

• Income taxes: The business's taxes pass-through to the owner's personal taxes- that is to say that the business and owner are treated as a single unit. The owner's taxable income may be reduced through charging off business expense costs.

• Longevity: The business dies with the owner. Without careful advanced planning, only essential transactions are permitted post-mortem.

• Control: The sole proprietor retains absolute control over all aspects of the business. The owner may choose to employ people to manage the business, but, ultimately has final sign off and veto co...


... middle of paper ...


...g the pass-through taxation that is used as sole proprietor or as a partnership if members are added. This avoids double taxation. It also allows the owners personal income tax liability to be offset by the company's likely upcoming expense and losses.

The LLC will allow the owner to offer some level of membership to an investor. An affluent investor may find the possibility of offsetting his/her tax burden from outside income through investing in a profitable business with considerable upcoming expense related to an expansion to be very attractive.

In the operating agreement, the owner will be able to add family as members of the company as well as define the role and power of any members gained through investment. If he dies, his remaining family will remain to be members of the LLC with the power to approve or veto transference of ownership interest.




Need Writing Help?

Get feedback on grammar, clarity, concision and logic instantly.

Check your paper »

Essay on The Effect Of Lean Six Sigma On The Employee And The Organization

- The Effect of Lean Six Sigma on the Employee and the Organization Abstract Lean Six Sigma is a methodology that creates processes within an organization to cut waste and improve the company’s performance. However, studies have shown that over the past decade applying Lean Manufacturing and Six Sigma can create problems for companies financially and potential problems for employees. Companies should take great care before implementing a Lean Six Sigma solution because in some instances, going lean can do more harm than good both financially for the organization as well as destroying employee loyalty and moral....   [tags: Six Sigma Business]

Free Essays
1957 words (5.6 pages)

Six Sigma Of Smes With A Successful Experience Essay

- Six Sigma in SMES with a Successful Experience in Aeronautics Six sigma is an important tool applied by organizations towards making improvement strategies. Six sigma implementation in SMEs is challenging because of production volumes, size, the degree of employee training, and resources which are normally smaller compared to bigger organizations (Pedro, Garrido vega et al. 8). There are some key factors and obstacles though that influences the implementation of six sigma towards the success of an organization in total quality improvement....   [tags: Six Sigma, Strategic management, Business process]

Research Papers
872 words (2.5 pages)

Lean Six Sigma Or Six Theta Essay

- Lean Six Sigma or Six Sigma There is always a debate in the business world as to whether lean six sigma or six sigma is the best suitable process to implement when it comes to organizing processes pertaining to business and eliminating wastes. Both these systems have their supporters, claiming theirs to be the best. On the other hand, some argue that both should be implemented for ensuring the success of any organization. For clearly understanding the debate, it is essential that the differences between the two systems should be understood....   [tags: Six Sigma, Lean manufacturing, Quality management]

Research Papers
729 words (2.1 pages)

Case Studies On Six Sigma Essay

- CASE STUDIES ON SIX SIGMA IN LIBRARIES Many studies have concluded that targeted the verification of the effect of the application of Six Sigma in libraries that the concept of Six Sigma to achieve a number of competitive advantages. It is including improved business performance and streamline business processes and improve the quality of services provided by libraries levels, and that the application of the concept of Six Sigma in libraries needs to unite workers in libraries and support the efforts and participation of all of the process....   [tags: Six Sigma, Strategic management]

Research Papers
1011 words (2.9 pages)

The Fundamental Objective Of The Six Sigma Essay

- The fundamental objective of the Six Sigma methodology is the implementation of a measurement-based strategy that focuses on process improvement and variation reduction through the application of Six Sigma improvement projects. One of the ways that this is done through the DMAIC process (define, measure, analyze, improve, control) which is an improvement system for existing processes falling below specification and looking for improvement. Compared to the DMADV process (define, measure, analyze, design, verify), DMAIC uses the existing process as the baseline for a desired incremental improvement plan for the organization....   [tags: Six Sigma, Process capability, Business process]

Research Papers
713 words (2 pages)

Application And Execution Of Six Sigma Essay

- Annotation: Due to the fact many companies have expanded their operations internationally, this article investigates a valuable aspect of Six Sigma: how the application of the process is influenced by culture and how it influences cultures. The application and execution of Six Sigma vary based on a culture’s orientation, specifically on how companies focus on hard and soft savings and the organizational scope of projects. Therefore, these findings demonstrate how Six Sigma directly influences the general environment of an organization....   [tags: Six Sigma, Management, Strategic management]

Research Papers
1093 words (3.1 pages)

Lean Six Sigma Analysis Essay

- Lean and Six Sigma are two methodologies that industries use that rely on the improvement of performance by removing waste and reducing variation in the manufacturing processes. Sometimes industries pay their employees to take a Lean Six Sigma course to better improve the company's performance and make profit. However, some companies think Lean Six Sigma have no effect whatsoever in their process. Through this research, the effectiveness of Lean Six Sigma will be questioned and it will be shown whether if it improves performance in organizations and to what magnitude does it improve it....   [tags: Manufacturing, Six Sigma, Lean manufacturing]

Research Papers
964 words (2.8 pages)

Essay about Types Of Business Organizations The Cardigans

- There are three main types of business organizations the Cardigans can establish their home decor business sole proprietorship, partnerships and corporations. Sole proprietorship are the simplest form of business organization. Usually with sole proprietorship form of businesses one person has complete control of their business;however, one assumes all liabilities. According to miller, “The sole proprietor is free to make any decision she or he wishes concerning the business—including whom to hire, when to take a vacation, and what kind of business to pursue”....   [tags: Corporation, Business law]

Research Papers
1026 words (2.9 pages)

Diversity In Today's Organizations Essay

- With today's workforce becoming increasingly diverse and organizations doing more to maximize the benefits of the differences in employees, organizations are relying on managers to get the people who get the job done. People have always been the central to organizations, but there strategic importance is growing in today's knowledge-based business world. An organization's success increasingly depends on the knowledge, skills, and abilities of its employees excluding there gender, age, ethnicity, and the differences in skill and abilities....   [tags: Organizations Diversity Business]

Research Papers
1132 words (3.2 pages)

Essay on Organisations

- Organisations Objective: To understand the basic concepts of organisational structure as they appear on/affect ICT systems. What is an organisation. An organisation is a collection of human and non human resources that are brought together in order to fulfill a designated purpose. 1. Supermarket 2. School 3. Shop 4. Large commercial enterprise 5. Small informally structured non commercial group – green peace In some cases the structures are clearly defined and inflexible, in others the structure is less formally defined....   [tags: Business and Management Studies]

Research Papers
911 words (2.6 pages)