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I-Care Cutlery Having read a newspaper article about France passing a new law requiring that all plastic cups, cutlery and plates be composted, Brian had the idea to set up his own business I-Care Cutlery operating as a sole trader - Leaving Cert Business - Question A - 2019
Question A
I-Care Cutlery Having read a newspaper article about France passing a new law requiring that all plastic cups, cutlery and plates be composted, Brian had the idea t... show full transcript
Worked Solution & Example Answer:I-Care Cutlery Having read a newspaper article about France passing a new law requiring that all plastic cups, cutlery and plates be composted, Brian had the idea to set up his own business I-Care Cutlery operating as a sole trader - Leaving Cert Business - Question A - 2019
Step 1
Explain the term 'sole trader'.
Answer
A sole trader is a type of business entity owned and controlled by a single individual. This person has full authority over all business decisions and is subject to unlimited liability, meaning they are personally responsible for any debts incurred by the business. Consequently, any profits generated are retained entirely by the sole trader.
Step 2
Outline two benefits of setting up as a sole trader.
Answer
- Profits: As the sole owner, the individual keeps all profits after tax obligations have been met, providing a strong incentive to succeed.
- Control: The sole trader maintains complete control over the business decisions, allowing for quick and responsive decision-making without the need for consultation or consensus from partners.