Chapter 4 Flashcards
What are types of business organisations?
The six types of business organisations are:
Public limited company
Sole trader
Joint ventures
Partnership
Private limited company
Franchises
What are types of business organisations?
The six types of business organisations are:
Public limited company
Sole trader
Joint ventures
Partnership
Private limited company
Franchises
What are the legal regulations required for a sole trader?
The owner must be registered with,and send annual accounts to government
The name of business should be significant
The sole trader must observe all law which apply to all business in industry
Advantages of being a sole trader
Independent
More profit
Few legal regulations
Connect to consumers
Complete secure in business maters
Disadvantages of being a sole trader
No one to discuss matter with
No benefit of limited liability
Less capital
If owner is on leave the production will stop
Who are the people recommended as sole trader?
The people who
Are starting a business
Dealing manly with public
Don’t need much capital in order to keep business going
How be partners can be there in partnership?
Max 20 min 2
Why is partnership agreement important?
Without this document,partner may disagree on who put most capital into the business or who is entitled to more profit. It will settle all these matters.
What are the advantages of partnership?
More capital
Less responsibility
Losses and profit will be shared
What are the disadvantages of partnerships?
They didn’t have limited liability.
There is no separate legal identity
Consulting and design takes time.
If one partner is very inefficient or dishonest others would suffer
What the situation when partnerships is most suitable?
When the partners are well know to each other
Where the professional body only allow partnership
When people want to form a business with other but avoid legal complications
