Module 3 Introduction: (CU3 M3) Organizations
Corporations are legal entities that protect shareholders from certain legal liabilities. For example, if you start a sole proprietorship and take out a small business loan to get started, you are personally liable for that loan. If you do not repay the loan, the bank can pursue your personal assets. If you are a shareholder in a corporation that fails to pay its loans, however, the bank cannot pursue your personal assets.
Being a corporation has its own caveats. For example, corporations are subject to more regulations and fees. This Credit Unit will look into the various types of business entities in the United States and weigh the pros and cons of each. We will emphasize corporations because most of us will end up working for them.
Identify and describe the various forms of business organization.
Discuss the advantages and disadvantages of each type of business organization.
Understand the four methods of corporate expansion: purchase of assets other than in the regular course of business, merger, consolidation, and purchase of stock in another corporation.