Three Forms of Business Organizations
Business Organizations-Summary
Jack Smith and Carl Jones are considering opening a lawn mower sale and service center. Jack and Carl come to you for a recommendation as to which business organization should be used to conduct their business.
Provide a brief summary of which form of business organization you believe to be the best form of organization to conduct their business and the reasons for your recommendation. Be sure to include an analysis of the advantages and disadvantages of other forms that may be available and the reason for your recommendation despite the disadvantages of your recommended form of business organization.
Your analysis should be no more than one typewritten page, in Times New Roman 12-point font, double spaced lines with one-inch margins on top, bottom and sides. Do not repeat the facts.
Business Organizations Summary
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Business Organizations Summary
Jack Smith and Carl Jones should choose between three forms of business organizations in the United States: corporations, partnerships, and sole proprietorships. Although they can use the three forms to provide their services, each business type has its inherent merits and demerits (CK-12 Foundation, 2020). I believe a general partnership (GP) is the ideal business organization form for Smith and Jones to run the lawnmower sale and service center business. A GP business type comprises partners who engage in routine operations of the entity and who are fully liable to debts and lawsuits as the owners (Murray, 2020). As a GP, the partners would share responsibility for running the business entity. Some of the benefits of a partnership include: it is easy to get into an agreement and start the business, it does not involve special taxes, it is easy to manage, and it is comparatively easy to attract investors. The main negative of this business type is that the partners are liable for each other’s actions, including debts (CK-12 Foundation, 2020).