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Legal Forms of Business Organization
This explains the various legal forms of business organization, including sole proprietorship,
partnership, and corporation
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Partnership offers joint ownership and limited liability, but
also has transferability issues
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In this section, we discuss the legal forms of business organization, specifically sole
proprietorship, and partnership
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The advantages of a sole proprietorship include low
organizational costs and maintaining control
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A
partnership is the next form of business organization discussed, where there are 2-20 owners
with unlimited liabilities and joint ownership of assets
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Now, we will discuss the partnership and corporation legal forms of business organization
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However, partnerships have disadvantages such as unlimited liabilities and transferability
issues
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Shareholders own the corporation and can have perpetual
succession, and corporations are managed by the Board of Directors
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In summary, corporations have advantages such as limited liability and separate legal entities,
but they require more regulation and are more complex to establish
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One
key advantage is that owners have limited liabilities, and the business can continue even if
the founder passes away
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However, forming a corporation is complicated and incurs high organizational
costs
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