Accounting 10Chapter 1 Notes

Types of BusinessForms of Ownership

Types of Business

1. Service Business-A service business sells a service to the public; it does

not make or sell a product as its main activity.

Examples:Video Rental OutletAccounting FirmMovie TheatreHair SalonCatering Company

2. Merchandising Business -A merchandising business buys goods and resells them at

a higher price for a profit.

Examples:Car DealershipClothing StoreMusic StoreSports StoreGrocery Store

3. Manufacturing Business-A manufacturing business buys raw materials, converts them into a new product, and sells these products to earn a profit.

Examples:Computer ManufacturerCar ManufacturerFarm Equipment ManufacturerFood-Processing Company

4. Non-Profit Organizations- A non-profit organization may carry on activities to meet social needs and not for a financial profit.

Examples:CharitiesChurchesAmateur Sports Organizations

Forms of Business Ownership

1. Sole Proprietorship- The owner is the sole proprietor. They are in business for themselves.

Examples:Dr. Joe Dimitry, DentistRosa’s PizzaAlf’s Home BakeryRustic Pottery – Miriam Daily, Owner

2. Partnership- A business involving more than one owner.

Examples:McPhearson & Scott, Chartered AccountantsBucchino & Magalli, Barristers and SolicitorsHakala and Sons Service CentreCafé Crème – Solange Dion and Alex Boucher, Owners

3. Limited Company- a form of business owned by shareholders (also known as a corporation).

Examples:Pool People Ltd.Uni Electrical and Mechanical Ltd.Gunn’s Auto Servie Ltd.Building Resources Ltd., Construction Consultants