Ownership Structures Flashcards
What is a sole trader?
Where one owner controls a business, they can employ others but they have full control.
What is a partnership?
Where two or more owners lead the business and share profits.
What is a private limited company?
A company which is generally quite small and has shares only owned by people involved in the business.
What is the three letter code for a private limited company?
LTD
What is a public limited company?
An organisation which has shares available to buy on the stock market.
What is the three letter code for a public limited company?
PLC
What is a franchise?
An owner can allow others to trade under the name of a business.
What is a co-operative?
All members have an equal vote in how a business is run, profits are shared between members and community projects.
What is a social enterprise?
A social enterprise puts the improvement of the world above making profits.
What is limited liability?
If a business goes into debt, then an owner can only lose what they invested into it.
What is unlimited liability?
If a business goes into debt, the owners can have their personal possessions taken from them to repay debt.
Which businesses have limited liability?
Private limited companies, public limited companies. co-operatives and social enterprises.
Which businesses have unlimited liability?
Sole traders, franchises and companies.
What is an advantage and a disadvantage of being a sole trader?
You control everything
You are your own boss
You have unlimited liability
You have long hours
What is an advantage and a disadvantage of being a partnership?
You share knowledge and skills
You share responsibilities
You may not agree with others
You have to share profits
