Question

Can someone please help me am doing business law not economics. It should be written in 100 words and have at least one citation from an alternative reliable source per response.

Explain the difference between a "for-profit" and "non-profit" corporation.

Answer 1

While for-profit organisations, based on their net income, are responsible for paying taxes, non-profit organizations are exempt from paying income tax. Since the goal of a nonprofit is to make the world a better place and invest time, resources, and funds in the community, in this way, the government credits nonprofits with benefits. While nonprofits are not required to pay net income taxes, they are liable for state and property taxes.

The distinction between a non-profit and a for-profit corporation is that each quarter an income statement will be generated by a for-profit. Income statements are designed to determine the financial performance of an organization four times a year. Instead of income statements, nonprofit organizations usually provide a list of operations to their supporters and the general public that will include all revenue, expenditures and plus net assets. The other tool on which a nonprofit relies is a quarterly balance sheet which lists the equity of the owner. Because non-profit organizations do not operate with owners at the helm, they create a document that shows the liabilities of the organization

The development of a standardized system for funding projects and activities is one of the most critical aspects of running an organization. For-profit organizations seek to fund their initial ventures through bank loans, local investors and sales revenues. If the product or service of a business is deemed to have a high potential market value, then they may have the opportunity to receive investment from national or global investors, such as corner investors and venture capitalists. Nonprofits also take a different approach by searching, among other things, for private donations of time and money, corporate sponsorships, and government grants.