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Business Theme 1 > 1.5.4 > Flashcards

1.5.4 Flashcards

1
Q

What is a private limited company known as?

A

LTD

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2
Q

What is a sole trader?

A

A business that has a single owner.

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3
Q

5 Benefits of a sole trader?

A

Keep all profits
Control
No conflicts
little bureaucracy
Income tax

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4
Q

Why is income tax an advantage?

A

Only pay once pass the threshold.

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5
Q

3 disadvantages of a sole trader

A

Unlimited liability
Less capital
Nobody covers absenteeism

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6
Q

What is a partnership?

A

Businesses owned by 2-20 people, incorporated.

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7
Q

5 Advantages of partnership

A

More capital
More skills
being able to cover absenteeism
Less bureaucracy
Income tax

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8
Q

3 disadvantages of partnership

A

Unlimited liability
Split profits
Conflicts

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9
Q

what is a private limited company?

A

Owned by a group of shareholders protected by a limited liability with shares being sold to family and friends.

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10
Q

4 advantages of private limited company

A

More capital
Limited liability
Control who to sell too
Corporation tax

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11
Q

Why is corporation tax an advantage?

A

Will not change no matter how much profit generated.

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12
Q

4 disadvantages of private limited company?

A

Taxed from £1
Share profits
Cannot sell to many investors
Expensive and time consuming to set up

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13
Q

What are public limited companies known as?

A

PLC

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14
Q

What is main difference between plc and ltd?

A

How the shares are sold.

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15
Q

What is franchising?

A

When an individual (franchisee) buys the rights to operate a business model from a franchisor ( large company ), in exchange for a lump sum and on going fees.

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16
Q

What is a social enterprise?

A

Focuses to create social or environment impact.

17
Q

Do social enterprises make profits?

A

Yes, but they re invest to help their cause.

18
Q

What are lifestyle businesses?

A

Small, owner-operated businesses that prioritise personal interests or growth.

19
Q

What are online businesses?

A

Businesses which can operate anywhere across the world through the internet.

20
Q

What is a public limited company?

A

Incorporated business owned by shareholders, where stocks can be bought publicly.

21
Q

What is stock market flotation?

A

When a business becomes a public limited company and sells to raise capital through selling shares publicly.

22
Q

5 Advantages of PLC?

A

Access to more capital
Shared risks
Increased liquidity
Extended decision making
greater public profile

23
Q

3 disadvantages of PLC

A

Vunerable to changes in share price
Directors are accountable for thousands
Affected by publicity.

24
Q

What is Unlimited liability?

A

Business owners are personally responsible for all debts owned by business.

25
Q

What is Limited liability?

A

Shareholders are not personally responsible for debts owned by business and can only loose initial investment.

Business Theme 1 (22 decks)

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