Types of Business: Sole Proprietorship, Partnership, Corporation

Types of Business
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Types of Business
Sole Proprietorship
A sole proprietorship has several advantages including few formal business requirements, low legal costs, retention of all profits, information privacy, and complete control of all the operations. The disadvantages of this form of business include difficulty in raising finance, unlimited liability, reverse economies of scale, limited continuity, and limited skills of management (Pride, Hughes, & Kapoor, 2009). The sole proprietor can easily follow the biblical standards in regards to doing business with others since he is the one in control of operations.
Partnership
The advantages of this form of business include capital and credit availability, ease of startup, combined skills and knowledge, and profit retention. Its drawbacks include management disagreements, unlimited liability, frozen investment and lack of continuity (Pride, Hughes, & Kapoor, 2009). In this case, it is hard for a partner in the business to follow the biblical standards in relation to working with others. A partner may engage in practices that are unlawful according to the Bible (II Corinthians 6:14-15 New International Version (NIV)).
Corporation
As for a corporation, the advantages include ease in the raising of capital, limited liability, guaranteed continuity, ease exchange of ownership, and specialized management. Its limitations include formation expense and difficulty, increase paperwork and government regulation, lack of secrecy, and delayed decision-making (Gupta, 2007). In this case, since stock owners are morally bound by the directors’ decisions, it is not easy to guarantee compliance with biblical standards.
Limited Liability Company (LLC)
In the case of an LLC, the advantages include less paperwork, flexibility in taxation,...