ch 14 Flashcards
what is
one person owning a business
exposed to all risks and liabilities
common choice of busn structures
sole proprietorship
what is
2 or more ppl manage and share the profits and losses ( high trust)
-taxes are paid on your income tax rates
- each is liable to financial obligations
general partnership
they invest in the business but do not work at the business. ( financial resources)
limit partnership ( will not be reliable)
separate legal entity created by the state government
legally liable for its actions
profits paid out to the owner
corp tax is calculated at a rate without adding the additional income
C corporation
stockholders elect special treatment for income tax purposes
must have no more than 100 shareholders
income & losses: passed through company’s shareholders’ tax returns
Short term investment
S corp
pass-through tax entity with either general or limited partners
limited partnership replaced by the limited liability
**llp - co-op for farmers
Partnership (LP and LLP)
ensures that strict standards of social and environmental performance
ensures that for-profit company fulfills its social mission
Managers need to balance between profit and social benefit goals
Busn Corporation
tax status available to corporations llc, trusts, and other structures
all not for profits are exempt from income tax
An organization’s earnings do not benefit individuals
cannot have shareholders
Profits are made from donations - except from income tax
non- for profit entities
legal mistakes made by _____
choosing the wrong busn strucutre incurs higher taxes
experienced invetors generally invest only in c corp
it is easy and inexpensive to convert to a C Corp.
startups
legal mistakes made by startups needs what
agreement b/w founders on key issues
comes before formal written agreements
shows how co-founder relationships will work
reight vesting schedule to protect cofounders
The Founders Agreement
IP
describes intangible personal property
- legally protects inventions
startups are dependent on IP protection
Valubale asset for startups
complicated when related to employee contracts
seek legal advice from an IP attorny early on in the startup
Intellectual Property
what are the 4 types of IP
**copyright: **protectioin of origional works
**Trademark: **word, name, symbol used to identiy a product
Trade Secret: Confidential information that provides a competitive edge
**Patent: **A grant of property rights on inventions ( provisionsal patent- 1 yr window ( figure out if it is a busn)
forms of patents: design, Utility, Food
IP type
IP can be protected throught NDA
should not be used when you just have a half-baked idea
Essentials for entrepreneurs to protect against the growing threat of IP theft
Non- Disclosure Agreement (NDE)
vocab:
ip theft has negative impacts on busn.
global online piracy is rife in the area of digital content
ip rights are territorial
Globa IP theft
publicly disclosing your invention
disclosing means you night not be able to even patent your product
file for provisional patent
failure to protect product and processes
common ip traps
common ip traps
failure to assign ownership
best to make formal agreements regarding ip ownership
Ownership can vest in :
ppl you havent paid
ppl you have paid but who havent signed a formal assignment of ownership
Hiring employee
equal employment opportunity
federal laws probhibit discrimination
workers with disabilities are also protected
no discrimination with regard to sexual oreintation
Hiring employees
hiring employees
used on documetns adn tax returns.
register newly hired employee with your state directory
Employer Identificaiton Number
EIN number
hiring employee
register wit labor departments to pay unemployment compensation tax
Unemployment
hiring employee
maintain a sage and healthy workplace
train employe to do thier job safely
medical treatment in place
maintain records filling tac returns, etc. go a long way.
safety measurement
hiring employees
startups and small busn use independent contractors
working iwth indepndent contractors gives employers greater felxibility
hiring a contractor or employee
