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PNDBF – Business Organization

PNDBF – Business Organization. Lim Sei Kee @ cK. Three major legal forms of a business entity. Sole proprietorship Partnership Company / Corporation. Sole proprietorship.

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PNDBF – Business Organization

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  1. PNDBF – Business Organization Lim SeiKee @ cK

  2. Three major legal forms of a business entity • Sole proprietorship • Partnership • Company / Corporation

  3. Sole proprietorship • A sole proprietorship is a business entity owned by one person who is legally responsible for the debts and taxes of the business

  4. Sole proprietorship • Ownership: 1 owner • Life: Ends when owner: • Is unable to carry on, • Dies, or • Closes the firm Responsibility for business debts if firm is unable to pay: Owner

  5. Advantages of Sole Proprietorship

  6. Disadvantages of Sole proprietorship

  7. Partnership • A partnership is a business entity owned by two or more people who are legally responsible for the debts and taxes of the business

  8. Partnership • Ownership: 2 or more • Life: Ends when partner(s): • withdraws, • Dies, or • Closes the firm Responsibility for business debts if firm is unable to pay: Partners individually and jointly

  9. Partners must agree upon: • Amount each partner will contribute • Percentage of ownership of each partner • Share of profits of each partner • Duties each partner will perform • Debts- the responsibility each partner has for the partnership’s debts

  10. Advantages of Partnership

  11. Disadvantages of Partnership

  12. Company / Corporation • A company / corporation is a publicly or privately owned business entity that is separate from its owners and has a legal right to own property and do business in its own name; stockholders are not responsible for the debts or taxes of the business

  13. Company / Corporation • Ownership: Can be thousands • Life: Continues indefinitely; ends when: -business goes bankrupt -stockholders vote to liquidate Responsibility for business debts if firm is unable to pay: Stockholders can lose only the amount invested

  14. Advantages of Company

  15. Disadvantages of Company

  16. Organizational Goals • These are defined as desired outcomes for individuals, groups, or entire organizations • They provide direction for the organization • They are benchmarks against which performance is evaluated • Goals are objectives- the two terms are used interchangeably

  17. Types of Goals: • Financial goals • These are related to the expected internal financial performance of the organization Strategic goals - These are related to the performance of the firm relative to factors in its external environment (e.g. competitors)

  18. Vision • Defines the desired or intended future state of an organization in terms of its fundamental objective and/ or strategic direction. • Is a long term view, sometimes describing how the organization would like the world in which it operates to be. • For example a charity working with the poor might have a vision statement which read “A world without poverty”

  19. Mission • Defines the fundamental purpose of an organization, succinctly describing why it exists and what it does to achieve its vision • This should be a statement of why an organization exist. The purpose of an organization. Ideally it should be one sentence, easily repeatable, and inspiring

  20. GOALS • Big steps towards accomplishing your mission/vision • They should constitute a stretch (not something you know you can easily reach). • They should be aligned with principles and values • Goals, when accomplished, should bring you closer to your vision

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