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DEFINITION
Ownership is the state of exclusive rights
and control over property which may be an
object , land , real estate , or intellectualproperty.
NEED FOR AN
OWNERSHIP
As and when an Entrepreneur wishes to raise a
loan , a banker, a financial institution and even a
private money lender like to know the ownership
form of enterprise .
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TYPES OF OWNERSHIP
Proprietorship
Partnership
Company
Co-operative
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PROPRIETORSHIPIn proprietorship the enterprise is
owned and controlled by one person . It isalso called as sole trade organization .MAIN FEATURES
One man ownership
No separation between ownership
management Unlimited Liability
All profits and losses to the proprietor
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ADVANDAGES
Simple form of organization
Owner’s freedom to take decisions
High secrecy Tax Advantage
DISADVANTAGES
Limited Resources
Limited Ability Unlimited liability
Limited life of Enterprise form
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PARTNERSHIP
In Partnership more persons come
together and starts business .
MAIN FEATURES More persons
Profit and loss sharing
Contractual Relationship Unlimited liability
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ADVANTAGES
Easy formation
More capital available Diffusion of Risk
DISADVANTAGES
Unlimited liability
Divided authority
Lack of continuity
Risk of implied Authority
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COMPANYAn association of many persons who
contribute money or money’s worth to acommon stock and employ it in some trade orbusiness and also share the profit as case maybe , arising therefrom.
MAIN FEATURES
Perpetual Existence Limited Liability
Number of members
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PRIVATE COMPANY
A private company has been defined as acompany which by its Articles of Association
a) Restricts rights to transfer sharesb) Limits of number of its members to fifty
c) Prohibits any invitation to the public to subscribe for theshares
PUBLIC COMPANY
A Public company is one which place norestrictions by its Articles of Association on transfer of shares . Minimum number of person is seven and there isno limit to maximum number of share holder
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ADVANTAGE
Perpetual Existence
Professional management Diffusion of risk
Expansion Potential
DISADVANTAGES
Lack of secrecy
Legal restrictions
Management Mischiefs
Lack of personal interest
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CO-OPERATIVE
MAIN FEATURES
o Voluntary association
o Service motive
o Government control
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ADVANTAGES
oEasy formation
o Limited liability
o Social services
DISADVANTAGES
o Lack of secrecy
o Corruption
o Lack of mutual interest
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1. Nature of business
2. Area of operations3. Degree of control
4. Capital requirements
5. Extend of risk and Liability
6. Duration of Business
7. Government Regulations
FACTORS INFLUENCING
CHOICE OF OWNERSHIP
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OWNERSHIP PATTERN IN SMALL
SCALE INDUSTRIES IN INDIA
Proprietorship is the most
popular form of ownership structure in small
scale industries is indicated by its 87% sharesin all Enterprises . Partnership is second largest
form of ownership and establishment of
company form involves complex procedures as
compared to Proprietorship and Partnership.
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THANK YOU
