Compare and Contrast Two Types of Business Ownership Term Paper

liken and Contrast Two Types of Business Ownership - Term Paper ExampleThe proprietor of a fillet of sole proprietorship type of duty only needs to register his/her name and get a hot location, and the contrast can begin after this process. He is fully liable for all the debts and profits incurred if a sole proprietor gets into a financial crisis, the creditors can sue the owner of the profession, and if this lawsuit is successful, the cable owner will pay all the debts. resole proprietorship has no entity separate from the owner this means that if the business owner signs a contract, it will only be under his name. Advantages of a sole proprietorship business include the facts that formation of the business is quite inexpensive and easy, carrying very minor formalness since it involves only bingle person. Employment tax is not charged on sole proprietorship types of businesses and owners exercise a great deal of freedom since they may freely mix business and personal assets (Spadaccini, 2007, p.5). However, despite being the easiest type of business to start, sole proprietorship has a number of disadvantages. These include the facts that sole proprietors cannot raise capital by change interests from the business, business liabilities and other personal liabilities for debts and losses are unlimited, and it is quite impossible for the business to continue, if the owner passes away. Sole proprietorship can either be terminated by contract or if the owner dies. In case the sole proprietor gives up the business, sells it, or passes away, the existence of the business ceases (Types of Business Ownership, n.d.). Spadaccini defines league as a business organization formed when two or more persons or entities come unneurotic to operate a business for profit (2007, p.5). Partnership can be formed through... This report stresses that the accompliceship type of business ownership has a number of advantages. This comes from the facts that, just like sole prop rietorship, the kind of business is very inexpensive and easy for the partners to start, since they are able to consolidate their resources together. The business involves very minor formalities and does not hold any annual general meetings. Taxation is very fair on partnerships involving gnomish businesses, and the business is free from charges such as minimum taxes that are usually charged on contain Liability Companies and corporations. The author of the paper talks about partnerships which have a number of disadvantages. These include partners subjection to unlimited personal liability, which is very common, except in cases where the partnerships and liabilities are limited. Partnership types of businesses also experience disputes from time to time arising from differences among the different partners and finally Individual partners bear responsibility for the actions of other partners. there are various similarities and differences between sole proprietorship and partnershi p types of business ownership. This essay makes a completion that sole proprietorship and partnership types of business ownership share a number of similarities. However, the ways in which both businesses are formed and the way they operate are different.