Legal Basics and Business Entity Formation: Crash Course Business Entrepreneurship

The video explores various business structures, including sole proprietorships, partnerships, corporations, LLCs, co-ops, and nonprofits. It discusses the pros and cons of each, focusing on liability, taxes, and funding. The video also guides viewers on choosing a business structure and the steps to legally register a business, emphasizing the importance of understanding legal and financial implications.

What is a key step in making a business 'real' in the eyes of the world?

• Getting a business loan

• Launching a marketing campaign

• Legally registering your business structure

• Hiring your first employee

Which business structure is characterized by being owned and run by one person?

• Sole Proprietorship

• Cooperative

• Corporation

• Partnership

What is a major disadvantage of a sole proprietorship?

• Complex tax filing

• Limited liability

• Personal liability for business debts

• Difficulty in forming the business

In a general partnership, how is liability shared?

• Liability is shared equally among partners

• Liability is not applicable

• Liability is limited to the business assets

• Liability is limited to the partner with the most shares

What is a unique feature of a C-corp?

• It cannot sell stock to the public

• It is easy to form

• It offers limited liability to its owners

• It is exempt from taxes

How does a B-corp differ from a C-corp?

• B-corps focus on social good as well as profit

• B-corps are easier to form

• B-corps have no liability protection

• B-corps do not pay taxes

What is a key advantage of forming an LLC?

• Unlimited liability

• Pass-through taxation

• No need for legal agreements

• Double taxation

What is a primary characteristic of a cooperative?

• Owned by a single individual

• Decisions are made by a board of directors

• Each owner has one vote

• Profits are not distributed

What is a benefit of a nonprofit organization?

• Exemption from all forms of liability

• Ability to distribute profits to stockholders

• Tax-exempt status on profits

• No need for annual reports

What is an essential step in registering a business in the US?

• Opening a business bank account

• Hiring a tax accountant

• Getting an employer identification number

• Obtaining a business license from the city