Essays on The Business Structure, Product Pricing Assignment

Tags: Pricing
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The paper "The Business Structure, Product Pricing " is a perfect example of a business assignment. Deciding on a business structure is the preceding determinant of the business itself. It determines the form of the business. The business structure is incumbent on the type of business i. e. manufacturing or services. The nature of business influences the decision of business structure. There are usually three popular types of business structures in the UK vis-a-vis sole trader limited liability partnerships and public limited companies. Each of the business forms has different implications in respect to raising capital, liabilities and taxes.

A sole trader or an LLP business structure has no separate entity and has unlimited liability, but is restricted to the personal assets of the trader or the partners. It enjoys the benefit of taxation; profit generated from the business is taxed at individual rates. In the case of a partnership, the income is distributed between the partners based on their capital contribution and agreed on terms. Such forms of business are easy to dissolve and have no legal complexities. It gives no other person the control of the business, barring its partners or the trader himself.

In the case of a PLC, it has a wider scope of operations and various legal implications. Employees in a company are like agents with the authority to conduct the business on behalf of the company. It has a separate legal entity. It can raise capital through either debt or equity. It has restrictions on how much funds it can procure as stated in the memorandum. The liability is the total of its equity and debt capital, which is predetermined at the time of incorporation of the company.

Tax implications are usually high in the case of companies, as corporate tax rates are higher than personal tax rates. The initial business leverage depends on the volume of its planned operations. If the scale of operations is big, where it requires more funds, then it should consider the company business structure and sole trader or partnership if the levels of operations are expected to below. Scenario 2Capital is the resource that is needed for any business to be operational.

There are various ways to raise funds for a business depending on the business type i. e. services or product.

References

Graham, J. and Smart, S., (2011). Introduction to corporate finance: what companies do. Mason: Cengage Learning.

Hutt, M., Speh, T., (2012). Business Marketing Management. Ohio: Cengage Learning.

Murthy, R., P., (2005). Production and Operations Management. New Delhi: New Age International.

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