Sole Traders Flashcards
1
Q
What is a sole trader?
A
A sole trader is owned and managed by one person. (Someone who runs their own business)
2
Q
Number of owners?
A
There is only owner, the sole trader
3
Q
Who controls the business?
A
The sole trader controls and manages the business
4
Q
Who finances the business?
A
The sole trader finances the business
5
Q
What liability is there?
A
There is unlimited liability, this means that you can lose everything you own
6
Q
Who keeps the profit?
A
The sole trader keeps the profit
7
Q
How is the business
established?
A
You don’t have to register with the government to start trading
8
Q
Continuity – what happens
if the owner dies?
A
The business ends as well
9
Q
Advantages:
A
You are your own boss Can decide things quickly Easy to set up Keep all the profits Make your own decisions Wage bill will be low to employers Low amount of capital to run the business
10
Q
Disadvantages:
A
Unlimited liability May lack finance Heavy workload May not have all the skills required Difficult to take a holiday No shared responsibility
