MIDTERM

WEEK 1
 The Nature of Business
 The Purpose of Business
 Forms of Business Organizations
  Demonstrate an understanding of the nature of
business.
 Differentiate a businessperson from an entrepreneur
and a capitalist.
 Distinguish between the subjective reasons for putting
up a business and the objective purpose of the business
enterprise.
 Demonstrate an understanding of the nature and forms

HELLO! of various business organizations.

 Show how these organizations contribute to
socioeconomic development.
5
The Nature of Business
 What is the common
perception of Filipinos
to the Chinese people?
Businessperson Entrepreneur

Capitalist
Not all entrepreneurs
are necessarily
business persons.
Business Person to
Entrepreneur
“entrepreneurial
mind”
The Purpose of Business
Subjective Reasons
Subjective Reasons
Objective Purpose
Objective Purpose
Objective Purpose
Objective Purpose
 Forms of Business Organizations
Ease of formation and Unlimited liability
dissolution
Low startup costs and Limited life
low operational overhead
Typically subject to fewer Difficult for an individual
regulations to raise money for capital
No corporate income
taxes
Synergy resulting from two or more
individuals combining strengths
Easy to form but requires developing
partnership agreement
Subject to fewer regulations compared
to corporations
Stronger potential of access to greater
amounts of capital
No corporate income taxes
Unlimited liability where general
partners are individually responsible for
the obligations of the business
Limited life with the withdrawal or death
of a partner as reasons to end
partnership
Real possibility of disputes or conflicts
between partners that may lead to
dissolve the partnership
Unlimited commercial life because
corporation is an entity of its own
and does not dissolve when
ownership changes
Greater flexibility in raising capital
through the sale of stock
Ease of transferring ownership by
selling stock
Limited liability
Regulatory restrictions which can
be costly
Higher organizational and
operational costs
Double taxation referring to income
taxes that are paid twice on the
same source of earned income
Formation and registration is very Financial strength depend on the
simple with only 10 adults needed capital contributed by its members

Liabilities of the members of the society Maintain no secrecy in business

is limited to the extent of capital because the affairs of the society is
contributed by them openly discussed in the meeting
Members are provided with better good Members may not feel enthusiastic
and services at reasonable prices because the law governing the
cooperatives put some restriction on
the rate of return
Government extends many subsidies to Different opinions and disputes may
strengthen their financial stability and paralyses the effectiveness of the
sustainable growth in future. management