Jimber Atienza

Soc. Sci. 4

meaning

nxt

Business Type

There are variety of ways to

organized a business. The various business

types include:

Business Organization

OIs an organization under one management set up for the purpose of earning profits for its owners by making one or more items available for sale in market

OOldest and simplest form of business organization owned and manage by a single individual or family. Most of our business operational (including those which are not registered) belong to single proprietorship

Adva

ntage

s

disadv

antage

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Advantages:

I. It leaves full control in the hand of the owner

II. The sole proprietor receives all profits left after expenses are paid.

III. The sole proprietor receives all profits from his business. This gives him more incentives to make his business grow

Disadvantages:

I. Limited means of financing

II. Limited ideas

III. The sole proprietor is responsible for all losses

IV. The sole proprietor faces unlimited liability

to business

type

Unlimited liability

A legal obligation of a firm’s owners to pay back company debts with whatever resources him or her own

O It is a form of business organization in which two or more persona agree to own and operate a business. The partner agree to combine their resources (money, material, and

management), they also share their profits and losses

Adva

ntage

s

disadv

antage

s

I. The ability to raise more money

II. More potential for ideas and innovation

III. The ability to divide losses among all of the partners

IV. The ability to share workload among all of the partners

Advantages:

I. The need to obtain the agreement of many if not all partner for the obligations of the company

II. Limited liability of the partners for the obligation of the company

III. It may lead to dissolution

a. death of partner

b. bankrupt

c. insanity

Therefore, partnership lacks stability. To

continue its operation, a complete

reorganization is needed

Disadvantages:

to business

type

O Is a firm it has a legal status of a fictional individual is owned by a number if person, called the stack holder and its run by a set of elected officers and a board of directors, whose chairman is often also in a powerful position

O A business legally established under state laws that grant it an identity separate from its owners

Adva

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disadv

antage

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I. Limited liability

II. Access to large quantities of capital

III. Ease of operation with the help of a hired management

IV. PERMANENCE the firm is not dissolved or reorganized each time an owner leaves

Advantages:

Limited liability

Is a legal obligation of a firm’s owners to payback company debts only with the money they have already invested in the firm

I. Regulatory restrictions. Corporations are typically more closely monitored by governmental agencies, including federal, state, and local. Complying with regulations can be costly.

II. Higher organizational and operational costs. Corporations have to file articles of incorporation with the appropriate state authorities.

Disadvantages:

to business

type

O A cooperative is an autonomous association of persons who voluntarily cooperate for their mutual social, economic, and cultural benefit.

O A cooperative is a voluntary association of individuals with a common objective and bond of interest

References:

Economics

David N. Hyman 3rd Edition

pp. 186-190

Economics: principle and policy

William J. Baumol et al., 7th Edition

pp. 326-329