Entity Business Plan Ã¯Â¿Â½ PAGE \* MERGEFORMAT Ã¯Â¿Â½1Ã¯Â¿Â½
Entity Business Plan
For the purpose of this assignment, the Entity Business Plan the business venture that will be cover is a Sports Bar Franchise. The name of the Sports Bar is John's Sports Bar & Grill. Owning a business, organization or franchise is not as simple as one might assume. There are many things to consider when opening a business - the first and most important choice to make is what form of business - or what type of business entity - the company will take.
A corporation is the most dominant form of a business organization in the United States, size of ownership in a corporation can range from one owner to thousands of owners that are called "shareholder's" (Cheeseman, 2007). A corporation is a fictitious legal entity that is creating according to statutory requirements and corporation codes that are state statutes that regulate the formation, operation and dissolution of corporations (Cheeseman, 2007).
Corporations can range from government corporations, non-profit corporations, and for profit corporations (Cheeseman, 2007). Advantages of a corporation include limited liability, strong financing, perpetual life of the business and high liquidity of investment (Cheeseman, 2007). According to Cheeseman another advantage to a corporation is the centralized management by the board of directors that makes policy decisions concerning the operation of the corporation. Disadvantages to a corporation include a double tax and having to comply with statute (Cheeseman, 2007).
John's Sports Bar & Grill will start out as an S-Corporation. According to the U.S. Tax Code "An S corporation or S-Corporation, for United States federal income tax purposes, is a corporation that makes a valid election to be taxed under Subchapter S of Chapter 1 of the Internal Revenue Code. In general, S Corporations do not pay any...