Chapter 5 - Typed Of Business Organisation

Question 1

Unlimited Liability

Answer 1

The owner of a business is fully responsible for all the debts of the business

Question 2

Partnership

Answer 2

Where two or more individuals run a continuing business for profit

Question 3

Limited Liability Company

Answer 3

A form of organisation whose owners own shares and where the owners enjoy the benefit of having limited liability for the debts of the business. Companies have a separate existence from their owners

Question 4

Limited Liability

Answer 4

The responsibility of the owners of the business for the debts of the business is limited to the amount they have agreed to invest

Question 5

Sole Trader

Answer 5

A business owned by one individual. The individual bears sole responsibility for the business’s actions