Lecture 4 - 9.8.2008 - September 8, 2008 AEM 1200: Intro to...

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September 8, 2008 AEM 1200: Intro to Business Management Forms of Business Ownership Forms of business ownership - Sole proprietorship: business owned and managed by one person o Advantages  Ease of start/end Be your own boss Pride of ownership   leaving a legacy Retain profit No special taxes  o Disadvantages Unlimited liability – very risky Limited financial resources Difficulty in mgmt. Time commitment Few fringe benefits Limited growth Limited life span  - Partnership: legal form of business with two or more owners o Advantages More financial resources Shared mgmt Longer survival  Often used by doctors and lawyers frequently  o Disadvantages Unlimited liability Division of profits Disagreements among partners Difficult to terminate  - Corporation: legal entity with authority to act and have liability separate from its owners o Owners = shareholders who own assets o Separation of risk from ownership
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o Generate more revenue than sole proprietorships or partnerships o
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This note was uploaded on 08/28/2009 for the course AEM 1200 taught by Professor Perez,p.d. during the Fall '06 term at Cornell University (Engineering School).

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Lecture 4 - 9.8.2008 - September 8, 2008 AEM 1200: Intro to...

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