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Bus 210 Checkpoint Week 2

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Accounting

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Homework

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Bus 210 Checkpoint Week 2
A joint-stock company is a business whose capital is held in transferable
shares of stock by its joint owners. Probably the closest thing would be a
limited partnership or an LLC.
Today, whenever a group of people want to follow a rainbow that may
end in a pot of gold, they tend to form one of those two types of business
structures. Another way of looking at it might be to compare it to a
private equity firm. That's where a company takes a bunch of wealthy
people's money and buys up other businesses with it.
A Limited Liability Company (LLC) is a business structure allowed by
state statute. LLCs are popular because, similar to a corporation, owners
have limited personal liability for the debts and actions of the LLC. Other
features of LLCs are more like a partnership, providing management
flexibility and the benefit of pass-through taxation.
Owners of an LLC are called members. Since most states do not restrict
ownership, members may include individuals, corporations, other LLCs
and foreign entities. There is no maximum number of members. Most
states also permit “single member” LLCs, those having only one owner.

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A few types of businesses generally cannot be LLCs, such as banks and
insurance companies. Check your state’s requirements and the federal
tax regulations for further information. There are special rules for foreign
LLCs.
A partnership is the relationship existing between two or more persons
who join to carry on a trade or business. Each person contributes
money, property, labor or skill, and expects to share in the profits and
losses of the business.
A sole proprietor is someone who owns an unincorporated business by
himself or herself. However, if you are the sole member of a domestic
limited liability company (LLC), you are not a sole proprietor if you elect
to treat the LLC as a corporation.

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