business Flashcards
what is business ownership
Refers to the control over the
business/enterprise and therefore
establishing who has the power to dictate
instructions.
How do we use business ownership
Sole trader
Partnership
Private limited companies
Public limited companies
what is Concept of liability
Business liability refers
to the responsibility of the
business owners’ for debts
incurred by the business.
How do we use concept of liability
Limited
Unlimited
what is Sole traders
Businesses owned by one person.
example of sole traders
Florist
Hairdresser
Coffee shop
How do we use sole traders
They may have a number of people
working for them but the ownership
remains with one person.
What is a Partnerships
A business owned by between 2 -20
partners.
How do we use partnerships
There are very strict rules controlling
the creation of partnerships. There must be
at least 2 partners within the partnership but
they do not have to have an equal share.
example of partnerships
Dentist
Solicitors
Accountants
what is Private limited companies (LTD)
A private limited company is often, but
not always, a smaller business. There is a
minimum of two owners within this company.
how do we use private limited companies
The owners of a private limited
company are called shareholders, because
each has invested money in the business and
now owns a share. Shares cannot be sold to
the general public.
how do we use need of partnerships
Information on the way in which the business operates
The role of each partner within the business
How profits and losses will be shared among partners
Details on how much capital each partner has
contributed – very important because not all partners
invest an equal amount
what is need of partnerships
A document drawn up to outline key information
about the partnership.
why is need of partnerships used
If this deed does not exist then law states each
partner is equal no matter how much capital they invested.
