business ownership Flashcards
1
Q
what are the four types of business ownership? (4)
A
- sole trader
- partnership
- company
- non-for-profit
2
Q
what is a sole trader?
A
someone who sets up a business by themselves
3
Q
what are some of the advantages to being a sole trader? (3)
A
- its quick and easy to set up
- you make all the decisions yourself
- you keep all the profits
4
Q
what are some of the disadvantages to being a sole trader? (6)
A
- it can be stressful making all the decisions
- you have unlimited liability (you are responsible for everything)
- it is usually a lot of work
- if the sole trader stops the business stops
- may lack finance
- may find it difficult to take breaks
5
Q
what is a partnership?
A
when two or more people join together in a business enterprise to pursue profit
6
Q
what are some of the advantages to being in a partnership? (3)
A
- shared workload so you’re not doing everything
- more sources of finance
- shared skill sto utilise
7
Q
what are some of the disadvantages to being in a partnership? (4)
A
- you may disagree with the other partners
- you still have unlimited liability
- liable for the actions of both you and your other partners
- shared profits
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)
9
Q
what are some of the advantages to being a company? (4)
A
- limited liability
- better status in the eyes of some customers
- continues even if the original funders stop
- can bring in investors
10
Q
what are some of the disadvantages to being a company? (4)
A
- have to register
- have to disclose information about sales and profit
- have to have accounts independently checked
- if there are other investors the original founder is not in full control of the business