Proprietorships, Partnerships, & corporations?

Question

What do each of these terms mean?

And if you were starting a business which would you choose and why?

Answer 1

I would chose corporation since that is a separate entity from the owners and thus protected in the event of a lawsuit.

Answer 2

All three are separate and distinct from the owners in the sense that their accounting records do not include the owner's/owners' personal financial records.

A sole proprietorship has a single owner called the proprietor, who generally is also the manager. Sole proprietorships tend to be small service-type businesses and retail establishments. The owner receives all profits, absorbs all losses and is solely responsible for all debts of the business.

A partnership is a business owned and operated by two or more persons who bind themselves to contribute money, property, or industry to a common fund, with the intention of dividing the profits among themselves. Each partner is personally liable for any debt incured by the partnership, meaning their personal properties will be used to pay for partnership obligations if partnership's assets cannot absorb all liabilities.

A corporation is an artificial being created by operation of law, having rights ot succession, and the powers, attributes, and properties expressly authorized by law or incident to its existence. It is owned by stockholders who invest in shares of stocks. The stockholders are not personally liable for the debts of the corporation. However, to form a corporation, you would need large amounts of capital.