lesson 2

• an activity where goods or services are exchanged for money.

  business
• A person who is engaged in business is called

  entrepreneur or businessman.
• It is the simplest form of business organization, owned by one person known as the proprietor or entrepreneur. A sole proprietorship is registered with the Department of Trade and Industry (DTI).


  Sole/single proprietorship.
• keeps all the profits, makes all the decision, easy to form and operate. minimal requirement set by the government, not taxed, easy to dissolve

  sole/single proprietorship advantages
• life of the business is limited to the life of the owner.Once the owner dies, the business will cease to operate under the name of the

  proprietor. amount of capital is limited only by the wealth of the proprietor. Unlimited liability. losses shoulder by the owner


  sole/proprietorship disadvantages
• It is defined as an association of two or more persons who bind themselves to contribute money, property, or industry to a common fund with the intention of dividing the profits among themselves. A partnership is registered with the Securities and Exchange Commission (SEC).


  Partnerships.
• The details of the arrangement between the partners are outlined in

  a written document called

  articles of partnership.
• professional partnership - tax exempted
• commercial partnership - taxable
• easy to form; mere agreement, higher capital, lesser gov. requirement and supervision

  partnerships advantages
• profits are divided, partner can be held liable for the acts of the other partners (agent of partnership), unlimited liability, personal properties can be held beyond their contribution, limited life, restricted transfer of ownership.


  partnership disadvantages
• business organized as a separate legal entity (artificial person) under the - law with ownership divided into transferable shares of stocks

  corporation
• Corporation Code of the Philippines creates a corporation.
• Articles of Incorporation


  written output information about corp.
• corp. will start after SEC APPROVED
• owners of corporations called

  stockholders or shareholders
• corporation shall not be less than 5 but not more than 15 individuals
• the proof of ownership is evidenced by a stock certificate
• can raise additional funds by selling shares of stocks ( proof of ownership) to the public, shareholders are not liable for the debts of corp, still can continue in spite of incapacity of 1 shareholder ease of transfer, limited liability , unlimited life- renew every 50 yrw

  
  

  • corporation advantages
• complicated to set up. It is relatively complicated to set up. Most

  costly and difficult to organize. Subject to several legal restrictions as listed in the Corporation Code of the Philippines, Taxed at flat 25% (effective Jan 1, 2022)


  corporation disadvantages
• duly registered association of persons with a common bond of interest, voluntarily joining together to achieve their social, economic and cultural needs.


  cooperative
• The owners are called members who contribute equitably to the capital of the cooperative.
• The founding members shall not be less than 15 individuals.
• cooperatives are regulated by the agency of Cooperative Development Authority (CDA)
• is entitled to only one vote regardless of his or her shareholdings. Generally exempt from paying taxes. Compared to a corporation, it is easier and less costly to form because of fewer business requirements, Limited liability. Unlimited life.


  COOPERATIVE ADVANTAGES
• it is relative complicated to set up. most costly and difficult to organize (higher cost of incorporation), Subject to several legal restrictions as listed in the corporation code of the Philippines, taxes at flat 25% 


  disadvantages of corporations
• it is a duly registered association of persons with a common interest


  cooperatives
• the owners of an cooperatives called a

  member
• the members are expected to

  patronize their products and services.
• the founding members shall not be

  less than 15 individuals
• cooperatives is regulated by

  cooperative development authority (CDA)
• each member is entitled to only one vote, the number of shares will only matter on the amount of profit you will be receiving, except from paying taxes, compared to a corporation, it is easier and less costly to form because of fewer business requirements. limited liability, unlimited life.

  cooperatives advantages
• prone to poor management because officers were only elected by board of directors rather than employed professional managers, since '' one-member, one-vote policy, influential tends to dominate the election process, difficult to sustain growth due to lack of profit, there are restrictions of transfers of members to members' shares.

  cooperatives disadvantages
• this is where you were going to see the information about corp

  articles of corporation
• sec 


  security and exchange commission
• dti


  department of trade and industry
• cda


  cooperative development authority
• types of business according to activities (semema)

  service business, merchandising or trading, manufacturing
• this type of business offers professional skills, advice and consultations. example: barber shops and beauty parlors, repair shops, banks, hotels and restaurant .. etc

  service business
• you don't need to worry about inventory, warehousing, and distribution cost, you only need a small capital 'cause u were selling your skill , u only need yourself.

  service business advantages