1. Business Organization

2. What is the most common business Organization? The most common form of business organization is the sole proprietorship. ◦ A sole proprietorship relies on the work and organizational abilities of one person.

3. What are some advantages of starting a sole proprietorship? Sole proprietorships are: ◦ easy to start up  Using loans, writing a business plan, using collateral to back the loan.  Able to start almost any where depending on local zoning laws. ◦ provide the single owner with full control of the business ◦ and allow the owner to keep all the profits.

4. What are some problems a sole proprietor may face? There are several problems related to sole proprietorships. ◦ First, the proprietor has unlimited liability for business debt. ◦ Second, the proprietor is completely responsible for all aspects of the business. ◦ Third, sole proprietors often have difficulty raising capital. ◦ Fourth, a sole proprietorship lasts only as long as the proprietor is willing and able to maintain the business

5. What is the next most common business organization? Partnerships are the next most common business organization. ◦ Partnerships spread the risk and workload of a company among partners.

6. How can a partnership be organized and what are their advantages? A partnership is easy to start up like a sole proprietorship. But because more than a single person is involved in the development of the business the structure is a bit complicated. A partnership may be organized either as a general partnership or as a limited partnership.

7. A General Partnership- Both partners are responsible for all: profits, losses, debts and liability. Each partner’s personal property can be targeted if the business fails. A limited partnership- partners join as investors for a percentage of the profits- they do not participate in the decision- making process and only have as much responsibility for liability as the percentage of the business that they own.

8. What are some disadvantages What are some disadvantages to a partnership? to a partnership? Unlike proprietorships, however, partnerships allow specialization and shared responsibility, shared decision- making, and shared business losses. Disadvantages for partnerships include unlimited liability, the potential for conflict, and a lack of longevity.

9. Discuss and make a list of advantages and disadvantages of opening one of the following businesses: Restaurant Small Retail Clothing Store Auto Repair Shop Law Office Dentist Office Flower or Gift Shop Dairy Farm Agricultural Spraying DJ (parties/weddings) Private Detective Print Shop Child Care Operator Or think of one of your own.