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buisness > Business Ownership > Flashcards

Business Ownership Flashcards

1
Q

Are businesses also companies?

A

No

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2
Q

Are all companies businesses

A

Yes

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3
Q

What is the main main feature of a company?

A

Limited liability

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4
Q

What is unlimited liability?

A

The personal possessions of the owners of a business are at risk if there are any problems; there is no limit to the amount of money the owner may have to pay out.

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5
Q

What are the 6 different types of businesses?

A 
Sole trader 
Public limited company 
Private limited company 
Partnership 
Non profit business 
Limited liability
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6
Q

What is a sole trader?

A

It is an individual Owning the business on his/her own

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7
Q

What is a partnership?

A

They are businesses that are owned by 2 or more partners. Each partner has an equal share of the profits and equal say in the decision process.

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8
Q

What are some advantages of a sole trader?

A
  • They are easy to set up
  • Gets to be their own boss
  • Decides what to do with the profit
  • It is easy to change the legal structure if circumstances change
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9
Q

What are some disadvantages of being a sole trader?

A

Unlimited liability
It can be hard to raise finance
If can be hard to keep employees
All the responsibility it yours

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10
Q

What are advantages of a partnership?

A

More people have more ideas
Easier to raise money
Good employees can be made into partners so it is easier to keep employees.

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11
Q

What is PLC?

A

Public limited company

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12
Q

What is LTD?

A

Private limited company

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13
Q

What are limited companies?

A

They are businesses that are owned by shareholders.

Public limited company’s
Private limited company’s

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14
Q

What are private limited companies?

A

They are company’s where ownership of shares is restricted. For the company to sell shares, all the current shareholders must agree to sell them.

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15
Q

What are some advantages of a private limited company?

A
  • Shareholders have a limited liability
  • it is easier than other businesses to get a loan
  • all shareholders must agree to sell their shares so he owner gets to keep a lot of control over the business
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16
Q

What are some disadvantages of a Ltd?

A
  • Finance is needed to incorporate a business
  • there is an upfront fee and paperwork
  • the company is legally obliged to publish their accounts each year and competitors may use this to their advantage
17
Q

What is a public limited company?

A

It is a company that sells shares in the stock exchange and anybody over the age of 18 can buy shares in that business.

18
Q

What are the advantages of a PLC?

A

Shareholders have limited liability because the company is incorporated.

Selling shares on the stock exchange allows companies to raise money for investment.

That can raise capital money from banks easier

19
Q

What does a limited company have?

A

A separate legal identity to own assets

buisness (8 decks)

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