Business Types

Essay by cupoblUniversity, Bachelor'sA, December 2006

download word file, 2 pages 1.0

For anyone who is trying to open their own business the first step should be to choose what type of business to operate. The type you select will affect how the business is structured and what rules may apply to the business. Some of the types that will be mentioned in this paper are a corporation, s-corporation, sole proprietorship and limited partnership.

Riordan Manufacturing, Smith Systems Consulting and Huffman Trucking are categorized under business type called a corporation. They have double taxation and their owners are shareholders. Corporation is a legal entity which is composed of person but exists separately from them. Huffman Trucking is privately held company which was found by K. Huffman and continuous growth enabled them to stay privately held. Any company to be privately held it must be organized as corporation. In privately held corporation the owners and managers may be the same individual. This type of business has limited liability, specialized management, double taxation and it is very expensive to organize.

Kudler Fine Foods is sole proprietorship business. It was organized by Kathy who is the sole owner no partners involved. She is doing business in her name and there is only one owner. She doesn't pay corporate taxes but pays personal income tax on the profits made.

McBride Financial Services is limited partnership. Limited partnership is partnership in which each partner is fully liable for the debts of the partnership. McBride Financial provides loan processing, mortgage, appraisal and inspections. In order to provide these different services this type of business is usually limited partnership.

The Elias Group is S-Corporation because it's non profit organization. S-Corporation passes profits and losses directly to its shareholders. The Elias Group was started by Ms. Elias who wanted to form non profit organization dedicated to business owners who wants...