Acct 561 Week 2
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- Date Submitted: 10/04/2012 02:19 PM
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Business Consulting Model
Mark Kovacs
University of Phoenix
Business Consulting Model
Sole Proprietorship
Advantages
Its creation requires only registration with the Trade and Companies Register (RCS) or in the trades and no minimum capital is required (as a sole proprietorship does not own assets). The steps for the creation of a sole proprietorship are simplified and less expensive. It is the way that requires less paperwork in its business constitution, that would be not forced to register in the commercial register (Nottonson, 2007).
Disadvantages
The entrepreneur is personally liable for debts incurred for the business, if it has some personal property; bankers will give him a loan more easily if it is limited to the capital of a corporation. From a social point of view, the individual entrepreneur shall be subject to the social workers' self-employed. In case of cessation of activity, it therefore cannot receive unemployment benefits. From a social point of view, the system of social protection of traders is less favorable than employees. In case of bankruptcy, individual entrepreneurs do not have unemployment insurance the general scheme (Bhide, 2000).
Partnership
Advantages
It limits the liability of shareholders to capital contribution to society. This business requires less formal rigor in the organization and lower minimum capital. It requires two to seven partners to form the partnership business. The partnership may allow the pooling of resources more developed. It can be a complementarily of skills, experiences (and the sales manager) but also greater financing capacity. Responsibility and therefore the risk are shared between the participants in the enterprise. Partners can help each other in the management of the company by a division of labor, especially in case of absence or illness (Nottonson, 2007).
Disadvantages
Shares cannot be transferred freely; the partner needs the consent of the other...
Mark Kovacs
University of Phoenix
Business Consulting Model
Sole Proprietorship
Advantages
Its creation requires only registration with the Trade and Companies Register (RCS) or in the trades and no minimum capital is required (as a sole proprietorship does not own assets). The steps for the creation of a sole proprietorship are simplified and less expensive. It is the way that requires less paperwork in its business constitution, that would be not forced to register in the commercial register (Nottonson, 2007).
Disadvantages
The entrepreneur is personally liable for debts incurred for the business, if it has some personal property; bankers will give him a loan more easily if it is limited to the capital of a corporation. From a social point of view, the individual entrepreneur shall be subject to the social workers' self-employed. In case of cessation of activity, it therefore cannot receive unemployment benefits. From a social point of view, the system of social protection of traders is less favorable than employees. In case of bankruptcy, individual entrepreneurs do not have unemployment insurance the general scheme (Bhide, 2000).
Partnership
Advantages
It limits the liability of shareholders to capital contribution to society. This business requires less formal rigor in the organization and lower minimum capital. It requires two to seven partners to form the partnership business. The partnership may allow the pooling of resources more developed. It can be a complementarily of skills, experiences (and the sales manager) but also greater financing capacity. Responsibility and therefore the risk are shared between the participants in the enterprise. Partners can help each other in the management of the company by a division of labor, especially in case of absence or illness (Nottonson, 2007).
Disadvantages
Shares cannot be transferred freely; the partner needs the consent of the other...