Small Business Chapter 7

Combines the advantages of a partnership and a C corporation. Is similar to a partnership in that the income of the business is not subject to double taxation.

S corp

Is a separate legal entity that, in the eyes of the law, is separate from its owners. In most cases a corporation shields its owners, who are called shareholders, from personal liability for the debts of the corporation. A corporation is governed by a board of directors, which is elected by the shareholders. A corporation is formed by filing articles of incorporation

c corp

is a formal statement of an organization's values on certain ethical and social issues.

code of conduct

is a separate legal entity organized under the authority of a state.

corporations

is a written document that deals with issues such as the relative split of the equity among the founders of the firm, how individual founders will be compensated for the cash or the "sweat equity" they put into the firm, and how long the founders will have to remain with the firm for their shares to fully vest.

founders agreement

A form of business organization where two or more people pool their skills, abilities, and resources to run a business. The primary disadvantage is that all partners are liable for all the partnership's debts and obligations.

general partnership

The most important thing that any entrepreneur, or team of entrepreneurs, can do to build a strong ethical culture in their organization is to

lead by example

Is a form of business ownership that is rapidly gaining popularity in the U.S.

limited liability company

A modified form of general partnership. The major difference between the two is that a limited partnership includes two classes of owners: general partners and limited partners. The general partners are liable for the debts and obligations of the partnership, but the limited partners are only liable up to the amount of their investment

limited partnership

prevents an individual from competing against a former employer for a specific period of time.

noncompete agreement

binds an employee or other party (such as a supplier) to not disclose a company's trade secrets.

nondisclosure agreement

two or more people start a business, they must organize as a partnership, corporation, or limited liability company.

partnership

The simplest form of business entity is the sole proprietorship.

sole prop

is a form of business organization involving one person, and the person and the business are essentially the same.

sole prop