business ownership Flashcards

1
Q

what are the four types of business ownership? (4)

A
  1. sole trader
  2. partnership
  3. company
  4. non-for-profit
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2
Q

what is a sole trader?

A

someone who sets up a business by themselves

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3
Q

what are some of the advantages to being a sole trader? (3)

A
  1. its quick and easy to set up
  2. you make all the decisions yourself
  3. you keep all the profits
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4
Q

what are some of the disadvantages to being a sole trader? (6)

A
  1. it can be stressful making all the decisions
  2. you have unlimited liability (you are responsible for everything)
  3. it is usually a lot of work
  4. if the sole trader stops the business stops
  5. may lack finance
  6. may find it difficult to take breaks
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5
Q

what is a partnership?

A

when two or more people join together in a business enterprise to pursue profit

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6
Q

what are some of the advantages to being in a partnership? (3)

A
  1. shared workload so you’re not doing everything
  2. more sources of finance
  3. shared skill sto utilise
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7
Q

what are some of the disadvantages to being in a partnership? (4)

A
  1. you may disagree with the other partners
  2. you still have unlimited liability
  3. liable for the actions of both you and your other partners
  4. shared profits
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8
Q

what is a company?

A

a business that has its own legal identity (it can own items, owe money, sue and be sued)

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9
Q

what are some of the advantages to being a company? (4)

A
  1. limited liability
  2. better status in the eyes of some customers
  3. continues even if the original funders stop
  4. can bring in investors
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10
Q

what are some of the disadvantages to being a company? (4)

A
  1. have to register
  2. have to disclose information about sales and profit
  3. have to have accounts independently checked
  4. if there are other investors the original founder is not in full control of the business
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