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types of Business Organization

a business organization + Cooperative

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types of Business Organization

  1. 1. Jimber Atienza Soc. Sci. 4 meaning nxt
  2. 2. Business Type There are variety of ways to organized a business. The various business types include:
  3. 3. Business Organization OIs an organization under onemanagement set up for the purpose of earning profits for its owners by makingone ormore items available for sale in market
  4. 4. 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 disadv antage
  5. 5. Advantages: I. It leaves full control in the hand of the owner II. Thesole proprietor receives all profits left after expenses are paid. III. Thesole proprietor receives all profits from his business. This gives him more incentives to makehis business grow
  6. 6. Disadvantages: I. Limited means of financing II. Limited ideas III. Thesole proprietor is responsible for all losses IV. Thesole proprietor faces unlimited liability to business type
  7. 7. Unlimited liability A legalobligationof a firm’sowners to pay back company debts with whatever resources him or her own
  8. 8. O It is a form of business organization in which two ormore persona agreeto ownand operate a business. Thepartner agreeto combine their resources (money, material, and management), they also share theirprofits and losses Adva ntage disadv antage
  9. 9. I. Theability to raise more money II. More potential for ideas and innovation III. Theability to divide losses among all of the partners IV. Theability to share workload among all of the partners Advantages:
  10. 10. 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
  11. 11. 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 chairmanis often also in a powerful position O A business legally established under state laws that grant it an identity separate from its owners Adva ntage disadv antage
  12. 12. 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 notdissolved orreorganized each time an ownerleaves Advantages:
  13. 13. 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
  14. 14. 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
  15. 15. 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
  16. 16. References: Economics David N. Hyman 3rd Edition pp. 186-190 Economics: principle and policy William J. Baumol et al., 7th Edition pp. 326-329