# Form of Business Organization :
Business organization can be structure in various ways both as legal entities and in terms of internal management process . The form of business organizations can be classified into following 3 category’s :
1. Sole Proprietorship :
In a sole proprietorship business their is only one owner . Their may be employees or helpers assistant and reporting to the owner but their is only one head to administers and run the show . It is a business enterprise , exclusively owned ,managed and controlled by a single person with all authorities responsibilities and risk .
* Advantage of sole proprietorship are :
- Easy Formation
- The benefit of secrecy
- Direct motivation
- Flexibility in operation
- It does not fall in co-operate tax bracket
*Disadvantage of sole proprietorship are
- Limited managerial ability
- limited amount of capital
- Not suitable for large scale operation
- Unlimited liability of the owner
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2.Partnership Firm
A business organization which owned and run by two or more individual agreeing to certain term and condition , sharing profit and loss of the business can be defined as partnership firm . When two or more individual agree to manage to operate a business organization by sharing common profit is known as partnership firm . A partnership firm in Nepal is guided and regulated by Nepal partnership act 2020 .
*Advantage of Partnership Firm
- Easy to Start
- raising of fund
- Sense of ownership
*Disadvantages of partnership firm
- Unlimited Liability
- Limited members
- Lack of harmony
- Legality
3.Company Co-operation (corporation)
A corporation or company is a voluntary association of individual for profit having a capital divided into transferable shares , the ownership of company is in conditions of membership . Again a company is an artificial person created by law having a separate legal entity with a perpetual (never ending) succession and common seal .
*Advantages
- Limited Liability
- Larger Capital
- Long life
- Higher profit
- Transfer Ownership
*Disadvantage
- Initial difficulties
- Lack of responsibilities
- Double taxes
- Late decision