Anonymous
Feb 3
State the characteristics of sole proprietorship, companies and Partnership ??
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Feb 3
Sole Proprietorship:
1. Ownership: Owned and operated by a single individual.
2. Liability: The owner has unlimited personal liability for the debts and obligations of the business.
3. Decision-making: The owner has complete control over all business decisions.
4. Taxation: The owner reports business income and expenses on their personal tax return.
5. Continuity: The business ceases to exist upon the death or retirement of the owner.
6. Capital: The owner provides all the capital for the business.
Company (Corporation):
1. Ownership: Owned by shareholders who hold shares of stock in the company.
2. Liability: Shareholders have limited liability, meaning their personal assets are protected from the company's debts and obligations.
3. Decision-making: Decisions are made by a board of directors elected by the shareholders.
4. Taxation: The company is a separate legal entity and pays taxes on its profits. Shareholders also pay taxes on any dividends received.
5. Continuity: The company has perpetual existence, meaning it can continue to exist even if shareholders change.
6. Capital: Capital is raised by issuing shares of stock to investors.
Partnership:
1. Ownership: Owned by two or more individuals who agree to share profits and losses.
2. Liability: Partners have unlimited personal liability for the debts and obligations of the partnership.
3. Decision-making: Decisions are made jointly by the partners, unless otherwise specified in a partnership agreement.
4. Taxation: The partnership itself does not pay taxes. Instead, profits and losses are passed through to the partners, who report them on their personal tax returns.
5. Continuity: The partnership dissolves upon the death, withdrawal, or bankruptcy of a partner, unless otherwise specified in a partnership agreement.
6. Capital: Capital is provided by the partners, who may contribute money, property, or services to the partnership.
1. Ownership: Owned and operated by a single individual.
2. Liability: The owner has unlimited personal liability for the debts and obligations of the business.
3. Decision-making: The owner has complete control over all business decisions.
4. Taxation: The owner reports business income and expenses on their personal tax return.
5. Continuity: The business ceases to exist upon the death or retirement of the owner.
6. Capital: The owner provides all the capital for the business.
Company (Corporation):
1. Ownership: Owned by shareholders who hold shares of stock in the company.
2. Liability: Shareholders have limited liability, meaning their personal assets are protected from the company's debts and obligations.
3. Decision-making: Decisions are made by a board of directors elected by the shareholders.
4. Taxation: The company is a separate legal entity and pays taxes on its profits. Shareholders also pay taxes on any dividends received.
5. Continuity: The company has perpetual existence, meaning it can continue to exist even if shareholders change.
6. Capital: Capital is raised by issuing shares of stock to investors.
Partnership:
1. Ownership: Owned by two or more individuals who agree to share profits and losses.
2. Liability: Partners have unlimited personal liability for the debts and obligations of the partnership.
3. Decision-making: Decisions are made jointly by the partners, unless otherwise specified in a partnership agreement.
4. Taxation: The partnership itself does not pay taxes. Instead, profits and losses are passed through to the partners, who report them on their personal tax returns.
5. Continuity: The partnership dissolves upon the death, withdrawal, or bankruptcy of a partner, unless otherwise specified in a partnership agreement.
6. Capital: Capital is provided by the partners, who may contribute money, property, or services to the partnership.
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