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  • 1. AIM: Discuss sole proprietorship and partnership legal form. Do Now: Why is important to define a target market and market niche?
  • 2. Sole Proprietorship
    • is a business that is owned and operated by one person.
    • Receives profit, incurs loses, and is liable for the debts of the business.
  • 3. Questions to ask:
    • How much liability protection, or insurance, do you need?
    • Do you need to see investment capital?
    • What effect will the business have on your tax status?
  • 4. Advantages of the Sole Proprietorship
    • Simple to create
    • Least costly form to begin
    • Profit incentive
    • Total decision-making authority
    • No special legal restrictions
    • Easy to discontinue
  • 5. Disadvantages of the Sole Proprietorship
    • Unlimited personal liability
    • Limited skills and capabilities
    • Feelings of isolation
    • Limited access to capital
    • Lack of continuity
  • 6. Unlimited Liability
    • Full responsibility for all debts and actions of the business.
  • 7. How to Set Up a Sole Proprietorship
    • Think of a Name
    • Hire employees (EIN-Employer Identification Number)
    • Sales Tax Identification number if you are a vendor or retailer.
  • 8. Liability Features of the Basic Forms of Ownership Sole Proprietorship Claims of Sole Proprietor’s Creditors Sole Proprietor’s Personal Assets
  • 9. Activity
    • Pick you partner carefully on page 137