Introduction to Businesses and Business types

Topics: Corporation, Business, Ethics Pages: 7 (1219 words) Published: May 28, 2014
BBI20-INTRODUCTION TO BUSINESS
Unit 1 BUSINESS FUNDAMENTALS

Business Categories and Types of Business Ownership

Learning Goals:
I will be able to describe and give examples of the two business categories. I will be able to describe and give examples of the five types of business ownership.

A business: Produces and/or sells goods and services to customers/consumers

Business Categories

1. For Profit: makes money (most businesses under this category)

2. Not for Profit: Helps others ( most government agencies go under this category)

Five Types of Business Ownership

1. Sole proprietorship: A business owned by a single person

What is meant by unlimited liability?
- Law doesn’t differentiate between the person owning the business and the business.

2. Partnership: A business that is operated by two or more partners who share costs and responsibility.

What are general partners?
– Active partners that are involved in the business (also have unlimited liability)

What are limited/silent partners?
– “limited” (silent) partners are investors and not involved in the business. They have limited liability.

What is meant by limited liability?
– Having limited responsibility - Not personally responsible for the debts of the business

3. Corporations: - Provincial/ federal, highly regulated, name must include: Incorporation(Inc), Corporation(Corp), or Limited(Ltd)

What is meant by being highly regulated?
- The responsibility of following many rules and also not taking advantage of investors

Can a corporation be small?
- Yes, a corporation doesn’t have to be a huge business.

What is a share/stockholder?
- Share/stockholder is an investor who puts money into ownage of a percentage/part of the corporation.

Would you be able to sue a corporation? Why? - Yes, since the corporation is itself an asset
- When someone sues the corporation, the corporation is sued.

What are the differences between a private and a public corporation? – Up to 50 shareholders and the shares are not affected (Private)… - Unlimited number of shareholders and shares may be traded publicly in stock exchange or by brokers (Public)

Are all public corporations traded on the TSX (Toronto Stock Exchange)? – Through brokers may also be a way that public corporations are traded.

What is a Crown Corporation?
– Owned by the government body

COOPERATIVE

4. What is a cooperative? – Owned and operated by the workers or members who buy the products or use the services that the business offers.

FRANCHISE

5. What are a franchise, a franchisor, and a franchisee?
FRANCHISOR: Seller of the franchise.
FRANCHISEE: buyer of the franchise
FRANCHISE: the rights to a business’s name, operating procedures, designs, and business expertise are licensed to another individual

What are 5 things that may be included in a franchise agreement? Paying the franchise fee
Agreeing to pay a monthly percentage fee plus national/local advertising costs. Purchasing all supplies from the franchiser
Participating in franchiser standards training

BBI20-INTRODUCTION TO BUSINESS
Unit 1 BUSINESS FUNDAMENTALS

More Business Basics
Learning Goals:
I will be able to define profit, revenue and expenses and explain the relationship among these terms. I will be able to define goods and services and give examples of businesses selling goods and services. I will be able to define and give examples of the industrial classifications in Canada.

Profit:

Another term for profit is earnings, or income

Revenues:

Expenses:
Profit= Revenues – Expenses
If expenses are greater than revenues, the business has a loss.

Profits are used to:
1. Provide better goods
2. Improve services
3. Gives the...
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