1.2 Flashcards
What is Sole trader?
A self - employed person who owns and runs their own business as an individual
What is Partnership?
A legal arrangement that allows two or more people to share responsibility for a business
What is LTD?
A general for of incorporation that limits the amount of liability undertaken by the company’s shareholders
What is PLC?
A business that is legally allowed to sell its shares to the public
Companies House
Any limited company or partnership business has to register with Companies House. These records are public and there is usually a fee to register.
Deed of partnership
A document that is signed by all of the owners of a business setting out the terms they must abide by and their obligations as owners.
Dividends
A sum of money paid regularly by a company to its shareholders out of its profits.
Economic of sale
Where the average costs (of production, distribution and sales) fall as the business increases the amount of product that it produces, distributes and sells.
Grant
A grant is money given to a business, usually by the government or lottery fund, that does not need to be paid back.
Hostile takeover
A takeover of one company (called the ‘target company’) by another (called the ‘acquirer’) that is accomplished without the agreement of the target company’s management. Instead, the acquirer approaches the company’s shareholders directly or fights to replace the management to get the takeover approved.
Income tax
Tax that someone pays based on their personal income (the money that they earn).
Limited Liability
When the business owner or owners are only responsible for business debts up to the value of their financial investment in the business.
Profits
The amount of money made after all costs are deducted.
Share capital
The money raised when a business becomes a public limited company by offering shares in the business in return for capital.
Shareholder
A part owner of a private or public limited company.
Shares
A percentage or portion of a company.
Stock market
A centralised market where business shares are traded.
Unlimited Liability
When the business owner or owners are personally responsible for all the debt of the business, no matter what the value.
