This website uses cookies to ensure you have the best experience. Learn more

Lit1 Essay

2842 words - 12 pages

Sole Proprietorship

A sole proprietorship refers to a form of organization owned by a single individual. In this business, a single person makes all the decisions and does not have to engage a legal department to approve contracts. The owner of such a business can only use personal funds even though he or she may have separate checking and savings accounts for the business.

The first characteristic of this form of business enterprise is liability. A sole proprietor suffers from unlimited liability. The owner becomes liable personally for all the obligations and debts of the business. The second characteristic is income taxes. Businesses pay federal income tax just like individuals. In ...view middle of the document...

This includes documents such as personal financial statements since the owner and the business are the same thing. Some of the disadvantages associated with a sole proprietorship are that it can be difficult to raise working capital. A sole proprietor faces unlimited liability. He or she is liable for all debts and obligations of the business.

General Partnership

A general partnership refers to an associated of two or more individuals in an unincorporated entity to carry out business, as well as share profits and losses (Flat World Knowledge, 2013). The first characteristic that applies to this form of business organization is liability. Each partner in a general partnership is severally and jointly liable for the debts and obligations of the partnership. The second characteristic is income tax. A general partnership faces the same taxation as a sole proprietorship. Income comes from the business and goes to the partners involved. They then pay the usual income tax on the income of the business. The third characteristic is control. In the general partnership, all partners have an equal voice in the management of the business. However, they can modify this as they wish through a contract. The fourth characteristic is profit retention. All the profits in a general partnership are shared equally among the partners. In addition, the partners also share losses equally should they occur. The fifth characteristic is location. To move or expand the business into a different state, all the partners have to come to a mutual agreement. Just like a sole proprietorship, there is no legal involvement in the partnership. The document required to relocate the business are a signed document showing that all the partners have consented to the relocation. This assures that the interests of all the partners are met. The sixth characteristic is convenience or burden. Just like a sole proprietorship, there are no additional requirements or extra workload placed upon the business to comply with all reporting, meetings, among others.
The advantages of a general partnership are that all profits and losses are shared equally among the partners. All the partners have an equal voice in the management of a business unless they agree otherwise on the contract. The disadvantages of a general partnership are that sometimes it becomes difficult to value the share of a withdrawing business partner. Another disadvantage is that all partners are liable for the debts and obligations of the business. For example, a partner may be innocent about a wrongdoing committed by another partner. However, they are still liable for that partner's malpractice (SkillSoft Corporation2, 2002).

Limited Partnership

A limited partnership is a partnership that has both limited and general partners. A limited partner enjoys limited liability in the partnership. The most limited partner can lose is only his investment into the business and nothing else. These partnerships are formed in a...

Other Papers Like Lit1

Lit1 Task #2 Essay

700 words - 3 pages Jed Worthington LIT1: Task 2 Situation A: Our company had an employee whose wife gave birth to twins prematurely. This employee requested leave in order to be with his wife. This particular situation fell under the Family and Medical Leave Act of 1993; it states that employers must grant 12 weeks during any 12 month period of time of leave to employees. An employee can qualify for the Family and Medical Leave Act when there is a birth

Lit1 Task 1 Essay

2575 words - 11 pages LIT1 Task 1, Part A Sole proprietorship: A sole proprietorship is an inexpensive and easy to form business organization. This entrepreneurship gives the owner the ability to have flexibility in their schedule. The business owner of this organization will benefit from having full control and retains all the businesses profits. Negatively, the business owner is also personally responsible for all the debt. and liability the business may

Lit1 Task 2

1073 words - 5 pages LIT1 Task 2 Situation A The Family and Medical Leave Act sets regulations for job-protected leave related to family and medical reasons. FMLA applies to organizations with 50 or more employees working within 75 miles of the employee’s worksite (“Employment Laws,” n.d., para. 6). Employees who have been with their current employer for 12 months and who have worked 1250 hours of service in the previous 12 months are eligible for 12 weeks of

Lit1 - Task 1

2877 words - 12 pages Legal Issues for Business Organizations – LIT1 Task 1 Legal Issues for Business Organizations – LIT1 Task 1 – Part A The way a business is organized is an important part of the business’s structure. “Different organizations provide different advantages and disadvantages in creation cost and simplicity, ongoing maintenance requirements, dissolution and continuity, fundraising, managerial control, public ownership, tax planning, and

Lit1 Task 1

1742 words - 7 pages Steve Wood LIT1 - Legal Issues for Business Organizations Task 1 Scenario A The purpose of the Family and Medical Leave Act of 1993 is to offer a balance between the stresses of both work and life. There are three main provisions of the act that are critical to the overall takeaway of what this law means to this situation. First, “Eligible employees can take unpaid, job-protected leave (they can return to their position). When they return from

Wgu Lit1 Task 1

3434 words - 14 pages Criteria That Determine Corporations. (n.d.). Retrieved November 17, 2014, from WGU - LIT1 - Template flashcards | Quizlet. (n.d.). Retrieved November 17, 2014, from The memorandum TO: Clients and Friends of the Firm FROM: Nikki Lingo RE: SEC Rule 65243 DATE: November 24, 2014

Lit1 Wgu Task A

4472 words - 18 pages LIT1 Task 1 Part A (the report) SOLE PROPRIETORSHIP: A sole proprietorship is the simplest, quickest and cheapest form of business to start making it the most popular types for first time business owners. A business owner and a sole proprietor may operate under different names, but legally, they are the same entity. Which leads to one of the biggest disadvantages of becoming a sole proprietor; the owner is responsible for all debts and fault

Lit1 Task1

3451 words - 14 pages Part A (the report) Forms of Business Organizations SOLE PROPRIETORSHIP A sole proprietorship is an unincorporated business entity owned by one person. A sole proprietorship is the most common form of business today. · Liability: This is one of the largest disadvantages of a sole proprietorship. There is no distinction made under law between the proprietor and the proprietorship therefore the proprietor is one hundred percent liable. In

Lit1 Organization

1367 words - 6 pages Business Organizations Task 1 Part A 1. Sole proprietorship: This type of business is known to be the easiest business for an individual to develop. A sole proprietorship is owned by one person, who is the person that will make the decisions in regards to the business and does not share any responsibilities with anyone else as the business owner. • Liability: One person is liable for the debts of this type of business, this will include their

Lit1 - Task 2 - 310.1.5-02, 11, 13 0912

1046 words - 5 pages LIT1 - Task 2 - 310.1.5-02,_11,_13_0912 Family Medical Leave act of 1993 The Family Medical Leave act of 1993 (FMLA) ensures that personnel of companies with 50 or more employees, who work within a 75 mile radius of those in need of the leave, are able to take time off in order to balance their personal obligations with their employment commitment. An employee will qualify for family leave if • they need time off for a serious health

Lit1 Task 1

3996 words - 16 pages Introduction: The three basic legal forms of businesses in the United States are Sole Proprietorships, Partnerships, and Corporations. However, each of these forms can have variations and a hybrid called a limited liability company can be formed in all US States that exhibit the characteristics of both a partnership and a corporation (American College, n.d.). The following are some of the forms of business existing in the United States and

Related Essays

Lit1 Sample Essay

1099 words - 5 pages format for Task 1 Part A for LIT1, the Bullet/Listing approach (mentioned in the Task 1 Instructions) is below, which basically is you’ll describe each characteristic in usually about 1-2 sentences then move on. Example of how to apply this format: SOLE PROPRIETORSHIP: •         LIABILITY – (1-2 Sentence Description) •         INCOME TAXES – (1-2 Sentence Description) •         LONGEVITY/CONTINUITY – (1-2 Sentence Description

Lit1 Corporations Essay

2102 words - 9 pages       LIT1  –  Task  1  (Part  A)       Sole  Proprietorship:   • Single Ownership - The single individual always owns sole proprietorship form of the business. The individual owns all assets and properties of the business and bears the risk of losing or gaining from the business.   • No Sharing of Profit – The business is owned by an individual, therefore, all of the gains are directly available for

Lit1 Task1 Essay

2765 words - 12 pages LIT1 Task 1 Part A SOLE PROPRIETORSHIP: A business that is owned by one person and is not incorporated. Sole proprietorships are easy to start. You don’t need a lawyer and you don’t need to register with the government except to obtain a business license or permit where required. * Liability: The owner is liable for all debts incurred by the business. His personal property can be attached. He

Lit1 Essay

328 words - 2 pages .Relevant Facts: Employee A has a 2 year tenure with Company X. Employee A asked for and was granted FMLA for the birth of his twins. Employee A asked to return to work before the allotted twelve week period had expired. On his return, he also requested for payment of his salary during his eleven week period of FMLA. His request for an early return was granted, but his time on FMLA remains unpaid. Employee A is now in an appeals process. Family