University of Phoenix Material
Business Forms Worksheet
There are seven forms of business: sole proprietorship, partnership, limited liability partnership, limited liability company (including the single member LLC), S Corporation, Franchise, and Corporation.
1. Research and provide three advantages and three disadvantages for each business form.
2. Provide a 100- to 200-word summary in which you provide an example business that you would start for each form. What is legally necessary to file in order to form that business? Discuss at least one of the advantages and one of the disadvantages of that form.
Sole Proprietorship
Advantages
1. Decision Making
2. Tax Benefits-one tax return
3. Ease of Formation
Disadvantages
1. Self Employment taxes
2. Liability
3. Raising Capital
Summary
A housecleaning service is a great example for a sole proprietorship. This is a simple business for any
Individual to start and relatively inexpensive. A sole proprietorship is fairly easy to set up. A sole
Proprietorship is a business that is owned and operated by one individual. The owner needs to insure
The name of their business is registered in the state the conduct business in to protect themselves
Against liability. Registering the business name allows one to conduct business under that name
Without infringing on other business that may have the same name. Failure to register the business
Name could put the individual owner in danger of fraud in the event of any confusion between
Companies. The simple advantage for a sole proprietorship is the ease of setting up the entity. The
Owner must follow their state’s procedures on the set up to properly register it. The disadvantage of a
Sole proprietorship is the liability. The owner has 100% of the liability if something were to go wrong
During his business operation.
Partnership
Advantages
1. More capital is available
2. Ease of Formation...