The oldest form of business organization is the sole proprietorship. A sole proprietorship is a business owned and operated by one individual. The sole proprietor is personally liable for the debts and obligations of the business.
A partnership is a business owned and operated by two or more individuals. The partners are jointly and severally liable for the debts and obligations of the business.
A joint stock company is a business that is owned by shareholders. The shareholders are not personally liable for the debts and obligations of the business.
A co-operative undertaking is a business that is owned and operated by its members. The members are not personally liable for the debts and obligations of the business.
The sole proprietorship is the oldest form of business organization because it is the simplest to form and operate. There are no formal requirements for forming a sole proprietorship. The sole proprietor simply needs to start doing business.
The partnership is a more complex form of business organization than the sole proprietorship. Partnerships must be formed in accordance with the laws of the state in which they are located. Partnerships must also file a partnership agreement with the state.
The joint stock company is the most complex form of business organization.
Joint stock companies must be formed in accordance with the laws of the state in which they are located. Joint stock companies must also file a corporate charter with the state.The co-operative undertaking is a relatively new form of business organization. Co-operative undertakings are not as common as sole proprietorships, partnerships, and joint stock companies.