Module 4: Forms of Business Ownership

This chapter discusses sole proprietorships, as well as several other forms of business ownership, including partnerships and corporations, and compares the advantages and disadvantages of each.

With a good idea and some cash in hand, you decide to start a business. But before you get going, you need to ask yourself some questions that will help you decide what form of business organization will best suit your needs.

Would you prefer to go it alone as a sole proprietorship, or do you want others to share your burdens and challenges in a partnership? Or would the limited liability protection of a corporation, or perhaps the flexibility of a limited liability company (LLC), make more sense?

There are other questions you need to consider too: Will you need financing? How easy will it be to obtain? Will you attract employees? How will the business be taxed, and who will be liable for the company’s debts? If you choose to share ownership with others, how much operating control would they want, and what costs would be associated with that.

1. Describe the advantages and disadvantages of the sole proprietorship form of business organization.
2. Discuss the advantages of operating as a partnership, and what downside risks should partners consider?
3. Discuss how the corporate structure provide advantages and disadvantages to a company, and what are the major types of corporations.
4. Discuss other options that a business organization has in addition to sole proprietorships, partnerships, and corporations.
5. Describe what makes franchising an appropriate form of organization for some types of business, and why does it continue to grow in importance.
6. Indicate why mergers and acquisitions are important to a company’s overall growth.
7. Identify how current trends will affect the business organizations of the future.

To achieve these objectives:

1. Read the Module 4 Introduction 
   
2. Read and view the materials in the Chapter 4 Pressbooks book.
   
3. Complete the Module 4 Quiz.
4. Complete the Module 4 Ethics Activity.
5. Compete the Module 4 Critical Thinking Case Group Assignment.
   

Module Pressbooks Resources and Activities