Check Point Business Organization Bus 210

Check Point Business Organization
Toni Roberts
Instructor: Yolanda Ruiz
August 7, 2013

According to Jones (2007); “In a joint-stock company an entrepreneur raises capital by issuing stock certificates of its ownership. This involves selling shares of the stock to investors that guarantee them the right to a certain percentage of the company’s profits” (p. 55). For instance, if I have shares in a large marketing firm, that means that I have a percentage of the vote concerning certain areas of the company including the management decisions and the board of elections. However, that also means that I have unlimited responsibility for the marketing firm’s outstanding unpaid liabilities as well (Investing Answers, 2013).
Jones (2007) states that, “Limited liability is a legal system that prevents creditors from seizing the personal wealth of a company’s stockholders to pay a company’s debts” (p. 56). An example of a limited liability business that our text gives is of Bill Gates’ Microsoft business. According to Jones (2007), Gates made his Microsoft stock public in the late 1980s, allowing investors to buy stock in his company (p. 57). However, Gates also used the profits he generated from the sale of his stocks to reinvest to various other stocks to ensure that his wealth would be sustained (Jones, 2007, p. 27).
”In a partnership, skilled professionals such as bankers, merchants, doctors, lawyers, and accountants agree to pool their talent and resources by establishing a company in which they are the only stockholders and owners” (Jones, 2007, p. 56). Depending on how much each partner initially puts into their stock of the business will determine their individual percentage and how much of the profits each are allotted (Jones, 2007, p. 56). Two examples that the text mentioned of this business model are “Salmon Smith Barney, an investment banking company, and Accenture, a consulting company” (Jones, 2007, p. 56).
“A sole proprietorship is a...