Topic 1.2 Business Ownership. Flashcards
Define a “sole trader”
someone who sets up in business on his or her own.
Define “profit”
Profit measures the difference between the values of a business’s revenue (sales) and its
Total Costs.
Define “unlimited liablility”
Unlimited liability means that the personal possessions of the owners of a business are at risk if there are any problems. There is no limit to the amount of money the owners may have to pay out.
Define a “partnership”
when two or more people join together in a business enterprise to pursue profit.
Define a “deed of partnership”
It is an agreement between partners that set out the rules of the partnership. An example of this is how profits will be divided.
Define a “stakeholder”
individuals and organisations that are affected by, and affect, the activities of a business.
Define a “company”
a business that has its own legal identity. It can own items, owe money, sue and be sued.
Define a “shareholder”
a person or an organisation that owns part of a company. Each shareholder owns a share of the business.
Define the “stock exchange”
a market for buying and selling shares of public
limited companies. Large numbers of shares are being bought and sold all the time.
Define “flotation”
Flotation happens when a private limited company (ltd) becomes a publiclimited company (plc) and has its shares listed on the Stock Exchange.
Define a “not for profit organisation”
An organisation set up to achieve objectives other than profit; for example, a charity.
