Differentiate between two legal forms of doing business. Dis
Not what you're looking for?
Differentiate between two legal forms of doing business. Discuss their differences and the benefits and liabilities between the two. Provide an example business. What would be the preferred form of business, and why?
Purchase this Solution
Solution Summary
Differentiate between two legal forms of doing business. Discuss their differences and the benefits and liabilities between the two. Provide an example business. What would be the preferred form of business, and why?
Solution Preview
Two vastly different forms of doing business would be a sole proprietorship (SP), and a limited partnership (LP). In a sole proprietorship, the owner "is" the business. The business is not recognized as a separate legal entity from the owner, which means that all of the liabilities of the business are the sole responsibility of the owner, and the owner is accountable for 100% of the actions of the business, with full and complete liability. In a SP, the owner reports all income and expenses directly on their 1040 tax return *(Schedule C), and the net profit or loss is taxed at the ordinary income rate. The owner also must pay self-employment tax, which also appears ...
Purchase this Solution
Free BrainMass Quizzes
Academic Reading and Writing: Critical Thinking
Importance of Critical Thinking
Basics of corporate finance
These questions will test you on your knowledge of finance.
Change and Resistance within Organizations
This quiz intended to help students understand change and resistance in organizations
Introduction to Finance
This quiz test introductory finance topics.
Cost Concepts: Analyzing Costs in Managerial Accounting
This quiz gives students the opportunity to assess their knowledge of cost concepts used in managerial accounting such as opportunity costs, marginal costs, relevant costs and the benefits and relationships that derive from them.