Business Organizations - PowerPoint PPT Presentation

Loading...

PPT – Business Organizations PowerPoint presentation | free to download - id: 6871ed-OTNhZ



Loading


The Adobe Flash plugin is needed to view this content

Get the plugin now

View by Category
About This Presentation
Title:

Business Organizations

Description:

Business Organizations Sole Proprietorship Partnership Corporation – PowerPoint PPT presentation

Number of Views:177
Avg rating:3.0/5.0
Slides: 55
Provided by: ThomasC85
Learn more at: http://p2cdn4static.sharpschool.com
Category:

less

Write a Comment
User Comments (0)
Transcript and Presenter's Notes

Title: Business Organizations


1
Business Organizations
  • Sole Proprietorship
  • Partnership
  • Corporation

2
(No Transcript)
3
Sole Proprietorship
  • Business owned and run by one person/family

4
Sole Proprietorship
  • Advantages
  • 1. Ease of starting up
  • 2. Ease of managing
  • 3. Keep all the profits

5
Sole Proprietorship
  • Advantages
  • No business income taxes to pay
  • - Not a separate legal entity

6
Sole Proprietorship
  • Advantages
  • 5. Personal satisfaction
  • - you are your own boss

7
Sole Proprietorship
  • Advantages
  • Easy to get out of business
  • - Pay up debts and stop offering goods or services

8
Sole Proprietorship
  • Disadvantages
  • 1. Personal unlimited liability
  • - Responsible for all losses and debts

9
Sole Proprietorship
  • Disadvantages
  • 2. Hard to raise financial capital (money needed
    to start the business)
  • - May have to use savings, credit cards, borrow
    from banks or friends/family

10
Sole Proprietorship
  • Disadvantages
  • 3. Size and Efficiency
  • - Need to hire enough people and stock enough
    inventory to be successful

Inventory stock of goods and parts in reserve
11
Sole Proprietorship
  • Disadvantages
  • 4. Limited managerial experience
  • - May need to hire people for that role

12
Sole Proprietorship
  • Disadvantages
  • 5. Hard to attract qualified employees
  • - Usually cant offer benefits available with
    large companies

13
Sole Proprietorship
  • Disadvantages
  • 6. Limited Life
  • - Ends with failure, death, or when the business
    is sold

14
Partnerships
  • Business that is jointly owned by two or more
    persons

15
Partnerships Two Kinds
I sure hope he knows what hes doing
  • General Partnership all partners are
    responsible for management and finances of the
    business

I sure hope he knows what hes doing
16
Partnerships Two Kinds
  • Limited Partnership at least one partner is not
    responsible for daily running of business

17
Partnerships - Formation
  • Articles of Partnership -
  • Filed with the state
  • Explain how profits are divided up
  • Explain how new partners can join

18
Partnerships
  • Advantages -
  • Ease of establishment
  • Attorney fees
  • Filing fees

19
Partnerships
  • Advantages -
  • 2. Ease of Management

20
Partnerships
  • Advantages -
  • 3. No special income tax to pay

21
Partnerships
  • Advantages -
  • Easier to obtain financing and capital
  • From banks
  • From new (rich) partners

22
Partnerships
  • Advantages -
  • 5. Larger size more efficient operations

23
Partnerships
  • Advantages -
  • 6. Can attract top talent to work

24
Partnerships
  • Disadvantages -
  • 1. Each partner is fully responsible for actions
    of all the partners

Limited Liability a partners liability is
limited to the amount he/she has invested in the
business
25
Partnerships
  • Disadvantages -
  • 2. Limited life partnership ends if a partner
    dies or leaves

26
Partnerships
  • Disadvantages -
  • 3. Potential conflict between partners

27
Partnerships
  • Disadvantages -
  • 4. If the business fails, partners may have to
    file for bankruptcy

Bankruptcy permission granted by the court to
stop or delay making payments on debt
28
Business Organizations Project
  • In groups of 4, create a new business to
    manufacture and sell a unique product
  • Must include
  • Model of the product
  • Brochure to sell the product
  • Commercial to market the product
  • Description of the business organization
  • (Major Grade)

29
Corporations
  • A business recognized as a separate legal entity
    with all the rights of an individual
  • Can
  • Buy and sell property
  • Enter into contracts
  • Sue and be sued

30
Corporations - Forming
  • To become a corporation, you must
  • 1. request permission from federal or state
    government receive a charter

Charter document from government granting
permission to incorporate
31
Corporations - Forming
  • To become a corporation,
  • you must
  • Issue stock to shareholders/
  • stockholders

Stock ownership certificates Shareholders/stockh
olders investors in the business
32
Corporations - Forming
  • To become a corporation,
  • you may
  • 3. Issue dividends to shareholders/
  • stockholders

dividend a check for a portion of the corporate
earnings (profit)
33
Corporations
  • Advantages
  • Ease of obtaining financial capital by
  • - Selling stock to investors
  • Issuing bonds

bond written promise to repay an amount at a
later date principal amount borrowed Interest
price paid for use of someones money
34
Corporations
  • Advantages
  • 2. Can hire managers to run the business

35
Corporations
  • Advantages
  • Provide limited liability for its owners
  • Owners not responsible for the success of the
    business
  • Stockholders only lose the amount they invested

36
Corporations
  • Advantages
  • 4. Unlimited life
  • Continues to exist even if ownership changes

37
Corporations
  • Advantages
  • 5. Ease of transferring ownership
  • Shareholders can sell stock to someone else

38
Corporations
  • Disadvantages
  • 1. Difficulty of getting a charter
  • Filing fees, legal fees

39
Corporations
  • Disadvantages
  • 2. Shareholders have little say once they vote
    for the board of directors
  • Board allows the management team to run the
    business

40
Corporations
  • Disadvantages
  • 3. Double taxation of corporate profits
  • Corporate profit is taxed
  • Personal income is taxed

41
Corporations
  • Disadvantages
  • 4. Subject to government regulations
  • Registered with a state
  • Registered with the SEC
  • Keep public informed on profits and losses

SEC (Securities Exchange Commission)
regulates and supervises sale of stock
42
Taking a Loan
  • Amount of Loan 15,000
  • Interest on Loan 10
  • Length of Loan 5 yrs.
  • Monthly Payment 318.71
  • Total Paid for Loan19,122.60
  • 1st Payment 193.71 (principal)
  • 125.00 (interest)

43
Business Growth
  • Reinvestment investment in new plant,
    equipment, and technologies

Net income revenue minus expenses/taxes
44
Business Growth
  • Reinvestment investment in new plant,
    equipment, and technologies

Depreciation general wear and tear on capital
goods
45
Business Growth
  • Reinvestment investment in new plant,
    equipment, and technologies

Cash flow net income plus depreciation (bottom
line)
46
Where is business growth taking place on the
chart?
47
Business Growth
  • Mergers combining two or more businesses to
    form a single firm
  • The new company, ChevronTexaco (worth 45
    billion), was formed October, 2001
  • With 53,000 employees
  • 7 (4,000 employees) lost their jobs

48
Business Growth
  • Why Merge?
  • To get bigger
  • To become more efficient
  • To eliminate rivals
  • To change identity

49
Business Growth
  • Types of Mergers
  • Horizontal two or more firms that make the same
    product join forces

50
Business Growth
  • Types of Mergers
  • Vertical firms involved in different steps in
    manufacturing join forces

51
Other Types of Corporations
  • Conglomerate
  • Corporation with at least four businesses making
    unrelated products

Were very popular in 70s and early 80s
52
Other Types of Corporations
  • Multinational
  • Corporation with manufacturing or service
    operations in a number of different countries

53
Other Business Organizations
  • Nonprofit Organizations
  • Promote the interests of the members, not the
    financial gain of their owners

Credit Unions
Labor Unions
Professional Associations
54
Other Business Organizations
  • Governments Role
  • Direct role distributes goods and services to
    customers
  • Indirect role makes sure the markets operate
    smoothly
About PowerShow.com