Bus 210 Week 2 Checkpoint

An example of a joint stock company would be the incinerator plant my husband

used to work for. Once an employee was permanently hired on with the company, the

company automatically opened a 401K plan in the employee’s name. Even if the

employee chose not to invest his or her money into the plan, the company automatically

invested 4% of the employee’s weekly earnings into the account. The employees could

choose to personally manage where they wanted to invest their money, but all employees

held stock in the company. After an employee was employed with the company for a

period of 2 years they could roll over the money the company had invested for them;

along with any they themselves had invested, if the employee changed jobs.

This company could again be used in the limited-liability example. If the

company had gone bankrupt any personal money the employees had would not be at

stake for reimbursement to creditors. Only the money the company’s employees had

invested would be at stake.

A law firm is a good example of a partnership. Most law firms are partnerships

because they consist of two or more licensed attorneys who have put together money to

form a business and agree to work together for the sake of make the business profitable.

I could use the daycare I used to run when my children were babies as an example

of a sole-proprietorship business. I ran the business from my home and was registered

with the state to provide subsidized daycare to eligible families. As a sole-proprietor the
cost of the business fell on me and the profits were mine alone. I was responsible for all

my personal bookkeeping, as well as providing my customers with weekly statements for

their bookkeeping and tax purposes. I had my own EIN number and was responsible for

filing and paying my taxes.