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Legal Forms of Buisness

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Submitted By tcon53105
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Legal Forms Of Business
Business Law/531
September, 17th 2012 Introduction There are several forms of business an entrepreneur can choose from when starting a new business. Most organizations choose to start up with a sole proprietorship, a partnership, (LLC) limited liability or a corporation. When deciding which legal form is best for your company, one must understand how each legal form works, then choose the right one that best fits the company’s needs. If a company is unsure of which form to choose from it is best to seek some legal guidance or an accountant? Small businesses may want to start with a sole proprietorship or partnership, mainly because personal liability is not a huge concern. These two forms are less complicated and inexpensive to start up and sustain. Corporations on the other hand are more complicated, cost more and are harder to form, however depending on the small business they may want to choose limited liability instead. Making the decision when choosing between LLC and cooperation factors on, incomes tax rates, personal liability, business debts and court judgments. Franchising a business is a way to expand a small business to the next level. Expanding is never easy but the best way to start is to make sure your company has enough money to pay for the expansion. When a company decides to expand they must make sure it will be profitable and get the businesses name out there. (Elgin, Jeff. September 1st 2002)

Scenario 1
Mike and John wants to expand their fancy Italian restaurant, their first restaurant is very successful and already has a wide variety of customers that come from a far just to eat at their restaurant. Mike and John chose general partnership as a legal form of business. Mike and John realizes they have a chance to begin expanding in a surrounding town and due to the success of the first restaurant they were able

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