Business ownership (AQA GCSE Business): Flashcards
📚Flashcards
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15 cards from this deck
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Practise the cards
15 cards from this deck
What is a sole trader?
What is a sole trader?
One individual owns & operates entire business
Sole trader main advantages
Sole trader main advantages
Simplicity, low cost, complete control, keeps all profits
Main risk of sole trader?
Main risk of sole trader?
Unlimited liability - personally responsible for all debts
What is a partnership?
What is a partnership?
Two or more people own and run business together
Partnership Agreement purpose
Partnership Agreement purpose
Legal doc outlining profit share, investment, decisions
Unlimited liability in partnerships
Unlimited liability in partnerships
All partners liable, even for debts created by one partner
Private Ltd key feature
Private Ltd key feature
Separate legal entity distinct from its owners
Limited liability means
Limited liability means
Shareholders only lose investment, not personal assets
What shareholders receive
What shareholders receive
Dividends - their share of company profits
Public plc key advantage
Public plc key advantage
Can raise substantial money by selling shares to public
Public plc minimum share capital
Public plc minimum share capital
£50,000
What is unlimited liability?
What is unlimited liability?
Business debts become personal debts of owner(s)
Which structures have limited liability?
Which structures have limited liability?
Private limited companies (Ltd) and public companies (plc)
Not-for-profit surplus use
Not-for-profit surplus use
Reinvested back into organisation to further its aims
Social enterprise reinvestment rule
Social enterprise reinvestment rule
Must reinvest at least 50% of surplus into enterprise