Week One - Topic One - Types Of Business Organisations Flashcards
Define the term Sole Trader?
One person trading as an individual, who is responsible for the business
Which Act proscribes that you must have a registered business name?
Business Names Registration Act 2011 (NSW)
What is an ABN and is it required (yes or no)?
Australian Business Number and yes it is required for taxation purposes
What is GST? When is it applicable for a sole trader?
Goods and Services Taxation. Applicable for incomes over $75,000
When does a sole tradership end?
When sold from an original sole trader to a new trader
Is Sole Trader the simplest form of business organisation?
Yes, it is
True or False: An advantage of a sole tradership is simplicity, meaning that the sole trader can register the business name and use personal assets?
True
True or False: An advantage of a sole tradership is control, as only one individual controls the business, the sole trader?
True
True or False: An advantage of a sole tradership is that profits do not have to be shared, meaning that profits are only for the sole trader?
True
Is this an advantage or disadvantage of a sole tradership: unlimited liability, meaning there is no distinction between the business and the sole trader?
Disadvantage
Is this an advantage or disadvantage of a sole tradership: accessing capital, meaning that often people are reluctant to lend/loan funds to a sole trader?
Disadvantage
Is this an advantage or disadvantage of a sole tradership: assets and liabilities of the company cannot be distinguished or separated from the individual owner, the sole trader?
Disadvantage
What is the current nature of the sole trader in Australia? What percentage of private firms constitute sole traders?
59.2%. It is recognised as the simplest trading entity in Australia. Common examples are lawyers and General Practitioners
