Chapter1 - has full Liability), Wealthy Limited Partners...

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Business Form Ownership Structure Longevity Liability Taxes Capital Acquisition Sole Proprietorship Owned & Operated by Individual Terminates When Owner Dies or Ceases Operations Owner has Unlimited liability Personal Taxes Only Difficult; Personal Wealth and Bank Loans (Owner has full Liability) General Partnership Ownership and Operating Activities Shared Between 2 or More Partners Terminates When Partners Agree To Cease Operations Unlimited (Joint and Separate Liability) Personal Taxes Only Difficult; Personal Wealth and Bank Loans (Owner has full Liability) Limited Partnership Joint Ownership, Operated by General Partners Terminates When Partners Agree To Cease Operations Liability Limited to Invested Capital Personal Taxes Only Difficult; Personal Wealth and Bank Loans (Owner
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Unformatted text preview: has full Liability), Wealthy Limited Partners Corporation Owned by Shareholders, Shares Easily Transferable. Shareholders Elect Board, Board Chooses Company Executives Potentially Infinite Liability Limited to Invested Capital Corporate Taxes, Personal Taxes on Capital Gains(Losses) and Income Distributions Relatively Easy. Access to Public Markets. 3 Characteristics of Corporation responsible for its popularity: Markets 1) Access to public Capital Markets (Equity and Debt) Primary Market (IPO, SEO) 2) Limited Liability status of ownership Secondary Market (ex. NYSE, NASDAQ, AMEX) 3) Secondary Market mechanism for transferring ownership (Liquidity of Investment) Finance 254 Business Forms & Their Characteristics 2003 Brian J. Henderson & Joseph M. Marks...
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