“Business may be owned by an individual or a group of persons.” In the light of the above statement enlist different forms of business organizations and explain how they are different from each other.
Answers
The following are different forms of business organization and their differences1)sole proprietorIts a business organization owned by an individual or a family.It requires very little capital to start, Doesn't really need any special tax filling.Owner enjoys profit alone.2)partnershipIts an arrangement where parties agree to cooperate to advance their mutual interest.Capital for starting the business is readily available due to the contribution by members.Losses usually shared by the memberscapital usually contributed by members.The responsibility of running the business is shared among the partners.3)corporationThis is a business organization formed by a group of people, and it has right and liabilities separate from its owners. It maybe a non-profit engaged for the public good.Corporation has rights and responsibilities as a person. Right to buy and sell, own property, sue and be sued if it violates the law.