| A | B |
|---|
| Business Organization | an establishment formed to carry on commercial enterprise |
| Sole Proprietorship | a business owned and managed by a single individual |
| Business License | authorization to start a business issued by the local government |
| Zoning law | law in a city or town that designates separate areas for residency and for business |
| Liability | the legally bound obligation to pay debts |
| Fringe benefit | payment other than wages or salaries |
| Partnership | a business organization owned by two or more persons who agree on a specific division of responsibilities and profits |
| General Partnership | Partnership in which partners share equally in both responsibility and liability |
| Limited Partnership | Partnership in which only one partner is required to be a general partner |
| Limited Liability Partnership | Partnerships in which all partners are limited partners |
| Articles Partnership | a partnership agreement |
| Uniform Partnership Act | Act ordering common ownership interests, profit and loss sharing, and shared management responsibilities in a partnership |
| Assets | money and other valuables belonging to an individual or business |
| Corporation | a legal entity owned by individual stockholders |
| Stock | a share representing a portion of ownership in a corporation |
| Closely held Corporation | corporation that issues stock to only a few people, often family members |
| Publically Held Corporation | corporation that sells stock on the open market |
| Bond | A certificate issued by a corporation, which promises to repay with interest the amount it borrowed from the buyer |
| Certificate of incorporation | license to form a corporation issued by state government |
| Dividend | the portion of corporate profits paid out to stockholders |
| Horizontal merger | The combination of two or more firms competing in the same market with the same good or service |
| Vertical merger | the combination of two or more firms involved in different stages of producing the same good or service |
| Conglomerate | Business combination merging more than 3 business that make unrelated products |
| Multinational Corporation | Large corporation that produces and sells it goods and services throughout the world |
| Business Franchise | A semi-independent business that pays fees to a parent company iin return for the exclusive right to sell a certain product or service in a given area |
| Royalty | share of earnings given as payment |
| Cooperative | A business organization owned and operated by a group of individuals for their mutual benefit |
| Consumer Cooperative | retail outlet owned and operated by consumers |
| Service Cooperative | cooperative that provides a service, rather than a good |
| Producer Cooperative | Agricultural marketing cooperative that helps members sell their products |
| Nonprofit Organization | Institution that functions much like a business, but does not operate in order to generate profits |
| Professional Organization | Nonprofit organization that works to improve the image, working conditions, and skill levels of people in particular occupations |
| Business Association | Nonprofit organization that promotes collective business interests for a city, state or other geographical area, or for a group of similar businesses |
| Trade Association | nonprofit organization that promotes the interests of a particular industry |
| Advantages of sole proprietor | keep all profits, easy to start up, complete control |
| Disadvantages of sole proprietor | unlimited personal liability, hard to get a lot of capital, may be hard to find good employees |
| Advantages of partnership | responsibility shared, easy to start up |
| Disadvantages of partnership | Responsible for acts of other partners, unlimited liability for at least one partner, conflict among partners |
| Advantages of corporation | stockholders have limited liability, can sell stock to raise money, borrow money by selling bonds, business continues after death of founders |
| Disadvantages of corporation | double tax, difficult and expensive to start, founders may lose control, managers and directors do not always act in the best interest of the stockholders, subject to more government regulation |
