Differentiate among the major forms of business organization...

Differentiate among the major forms of business organization and describe what you consider to be the top 2 advantages and disadvantages of each form. Address the regulatory and financial statement differences of each form of business.

Transcript

00:01 We have to discuss major form of businesses and also their two two disadvantages and advantages.

00:10 Okay, so let's discuss one by one number one is sole proprietorship, proprietorship.

00:23 So, as we all know this is all proprietorship in this and individual is an owner or proprietor and he or she can run the business.

00:33 Okay.

00:34 So now when we discuss its advantages number one, we can say ease of formation, ease of formation and low startup cost because it is run by individual so it can be easily form and low startup cost complete control over business decision complete control over business decisions.

01:09 Now when we talk about the disadvantage of this particular form, so, this is unlimited personal liability, unlimited personal liability as owner is responsible for all the liabilities he has to pay.

01:27 So, he has unlimited personal liability.

01:31 Second, limited access to capital and resources, limited access to capital and resources.

01:41 So, because only one person can run this business.

01:44 So, he has a limited access to capital and business.

01:48 The second form is partnership major form of business is partnership.

01:54 So, partnership is a form which is run by or two or more people.

01:58 So, this is depend on the level of business and the kind of business.

02:02 So, this is the partnership and there is a two or more people are involved and they divide their capital their profits in among them on the particular ratio.

02:12 They decided when we talk about the advantages for this.

02:17 So, number one will be shared financial burden shared financial burden and resources.

02:31 Second advantage can be diverse skill diverse skill sets and knowledge skill sets and knowledge from multiple partners.

02:48 When we talk about the disadvantages, so number one is unlimited personal liability again because the whoever is a partner in a company, they have to pay all the liability.

03:02 So, unlimited personal liability among for general partners and potential conflict among partners potential conflicts among partners.

03:15 There can be a rise of conflict.

03:17 Now, the third major form of business is corporation...

Question

Differentiate among the major forms of business organization and describe what you consider to be the top 2 advantages and disadvantages of each form. Address the regulatory and financial statement differences of each form of business.

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