term1 Definition1term2 Definition2term3 Definition3
Please sign in to your Google account to access your documents:
what is Sole Proprietorships?
1. Business owned by one person.2. Has sole control over management and profits3. Personal liabilityclass notes:you forming your own business…there’s no separate legal entity… you are the business.Using an assumed name… there’s no separationIt’s easy to form…everything you earn… u getSince it’s you…it’s your person liability… operating mom n pops grocery and a kid knocks over a jar and someone slips on it. They far and fracture their tail bone. They’re gonna sue u. Liability insurance. Ocean shipping…under the thread hold because of little business and does not need complianceOne person…owner is liable for everything…ex. if someone slip and falls..One good thing is that they are small enough to fall under the radar…less regulation… under 15 employees.
Definitions: 2/more people involved in a businessIncome taxed only at the partner level, not at the entity leveltwo types: general and partnership
a. management and profits are divided (usually equally) among the partnersb. unlimited personal liability for partnership’s debtsclass notes:General….all partner are liable… when getting a loan…all partner are liable. For tax….partnership is flow through… all incomes and losses are distributed equally and currently. K1 statement…shows your share of the profit or loses. In other words Can not hold earnings off of the entity level because they’ve been distributed for tax purposes. If you do decide to hold the money at a partnership level…u’re still liable for tax on the sum of money. Y do that??…if a company throws a lost…. The lost flow through your individual income tax return where you can used to offset capital gains.
a. At least one general partner and one limited partnerb. general partner (responsible for managing the business)c. limited partner (do not participate in management. Liability limited to the amount of money they put in)class notes:limited partnership…puts in $$$$...can only lose their $$ and partnership. Does not take active role in management…like buying stocks…they get earning and lost…if you do take active role (vote)…u lose the limited partner status…and you become general partnership with liability. Like stock
a. RUPA and RULPA- fills in where agreement does not cover an issueb. You should INVEST time and money to start an agreementc. The agreement should cover division of profits, duties, termination, and transfer of interests
Fills in where agreement does not cover an issue.class notes:If you don’t fill in or left out an agreement … the rupa will fill it in for you
what are classifications of Corporation?
Closely heldpublicly heldsub SLimited liability companies (LLC)
corporation:define closely held
Closely held (private)• owned by a small group of peopleclass notes:
• stock traded on the national securities exchange• numerous shareholders= investors• wealthier than any other forms of business organizationclass notes:the ppl/public hold stocks
Need help typing ? See our FAQ (opens in new window)
Please sign in to create this set. We'll bring you back here when you are done.
Discard Changes Sign in
Please sign in to add to folders.
Sign in
Don't have an account? Sign Up »
You have created 2 folders. Please upgrade to Cram Premium to create hundreds of folders!