Please explain some of the important disadvantages of sole proprietorship.© BrainMass Inc. brainmass.com October 25, 2018, 8:36 am ad1c9bdddf
Before beginning a business, it is essential to determine not only the type of business you plan to open, but also the structure of that business. Various business types exists, but according to All Business, a popular online business journal, sole proprietorships are the most common form of businesses. Many people often question why sole proprietorships are so common... The reasons/ advantages include: sole decision making power, inexpensive legal formation costs, few "formal business requirements," no corporation taxes, etc. (All Business, 2013).
Although all of these business advantages look quite ...
The solution below discusses the advantages and disadvantages of sole proprietorship businesses. This solution provides detail regarding why businesses should consider other business models of ownership other than sole proprietorship. This solution also provides website/ academic support regarding the topic of sole proprietorship.
Advantages and Disadvantages of Sole Proprietorship
See the attached case study. Use the questions at the end of the case for guidance, but please add to your explanations.
Please help me prepare 2-3 page response including synthesis of applications to corporate organizational structure. Please cite and list any references used.
The McGee Cake Comapny
In Early 2005, Doc and Lyn McGee formed the McGee Cake Company. The company produced a full line of cakes and its specialties included chess cake, lemon pound cake and double-iced, double chocolate cake. The couple formed the company as an outside interest, and both continued to work at their current jobs. Doc did all the baking, and Lyn handled the marketing and distribution. With good product quality and a sound marketing plan, the company grew rapidly. In early 2010 the company was featured in a widely distributed entrepreneurial magazine..... (see attachment for more case study details)
1. What are the advantages an disadvantages of changing the company organization from sole proprietorship to an LLC?
2. What are the advantages and disadvantages of changing the company organization from a sole proprietorship to a corporation?
3. Ultimately, what action would you recommend the company undertake, why?