liability-miss duddigan Flashcards
what is a private limited company
a business owned by shareholders protected by limited liability
what are the benefits to private limited companies
limited liability
raising capital
corporation tax
control over who buys shares
perceived as more reputable
what are the limitations of private limited companies
-shared profit-loads of shareholders running business
-taxed from the first 1 pound profit
greater
-financial documents are published
shares can only be traded privately
what is unlimited liability
business and owners are seen under the law
e.g. sole traders and partnerships
business debts become personal debts of the owner
what is limited liability
owners aren’t responsible for debts of the business
most shareholders can lose are the money they invested
what is a business plan
document that outlines what a business wants to achieve and how it plans to achieve it
what does a business plan contain
aims and objectives
details of who will work in the business
financial forecasts
advantages of using a business plan
proves that the business owners have done their research
reduces risk of business failing
convinces potential investors
what should a financial forecast contain
cash flow forecast
sales forecast
break even analysis
what is sales volume
number of units sold in a given time period
what is sales revenue
value of sales in a given time period
