Buissness Ownership

• What does limited liability mean for shareholders in a private limited company?


  Shareholders can only lose what they invested in the company.
• What are the key features of private limited companies (Ltd)?


  • Limited number of shareholders (usually up to 50)
  • Privacy in financial affairs
  • Can raise capital by issuing shares to new investors
  • Separate legal entity from its owners
• What is a public limited company (PLC)?


  A type of business structure that can offer shares to the general public.
• Where are public limited companies listed?


  On stock exchanges.
• What is the upper limit on the number of shareholders in a public limited company?


  There is no upper limit on the number of shareholders.
• What is a disadvantage of public limited companies?


  They are more complex and expensive to set up and run.
• What is an example of a public limited company?


  Tesco or Barclays.
• What are the key features of public limited companies (PLC)?


  • Can offer shares to the general public
  • Shares are freely transferable
  • Listed on stock exchanges
  • No upper limit on the number of shareholders
• What is a not-for-profit organization?


  An entity that operates for a social or public benefit.
• What happens to profits in a not-for-profit organization?


  They do not distribute profits to owners or shareholders.
• How do not-for-profit organizations use surplus money?


  They reinvest any surplus back into their mission.
• What are the key features of not-for-profit organizations?


  • Operate for social or public benefit
  • Do not distribute profits to owners or shareholders
  • Reinvest any surplus back into their mission
  • Can be charities, foundations, or other types of organizations
• What is an example of a not-for-profit organization?

  Oxfam or the British Red Cross.
• Which organization has no owners and is governed by trustees or a board?


  Not-for-profit organizations.
• Which type of organization can raise capital through public share offerings?

  Public Limited Companies (PLC).
• What is the primary goal of not-for-profit organizations?


  To provide social or public benefit.
• How do the regulatory requirements differ among Private Limited Companies (Ltd), Public Limited Companies (PLC), and Not-for-Profit Organizations?


  PLCs are highly regulated, Ltds are less regulated, and Not-for-Profits are regulated with potential tax benefits.
• What is one key feature of a sole proprietorship regarding profits?


  All profits go directly to the owner.
• What distinguishes a sole proprietorship from other business structures?


  There is no legal distinction between the owner and the business.
• What is a sole proprietorship?


  A sole proprietorship is a business owned and run by one individual.
• If a freelance graphic designer operates under their own name, what type of business ownership do they have?


  Sole proprietorship.
• What are the two main types of partnerships?


  General partnership and limited partnership.
• What is a key feature of partnerships regarding decision-making?


  Partners share ownership and decision-making responsibilities.
• If two friends start a small café together, what type of business structure are they likely using?


  General partnership.
• In a general partnership, how is liability shared among partners?


  All partners share equal responsibility and liability.
• What is a Limited Liability Company (LLC)?


  An LLC is a hybrid business structure that combines elements of both partnerships and corporations.
• What is a key advantage of an LLC compared to a sole proprietorship?


  An LLC provides limited liability protection to its owners.
• What does "limited liability" mean for LLC members?


  Members are not personally responsible for the LLC's debts beyond their investment.
• How does an LLC handle taxation?


  LLCs typically have pass-through taxation by default.
• How can corporations raise capital?

  Corporations can raise capital by selling stocks.
• What is double taxation in the context of corporations?


  Double taxation means corporate profits are taxed, and then dividends are taxed when distributed to shareholders.
• If a large public company like Apple is structured as a corporation, what type of corporation is it likely to be?


  1. Corporation.
• What is a cooperative?


  A cooperative is a business owned and operated by a group of individuals for their mutual benefit.
• What is a key characteristic that distinguishes a cooperative from other business structures?


  Cooperatives are owned and operated for the mutual benefit of members who use its services.
• How are decisions typically made in a cooperative?


  Decisions are made democratically, with each member having one vote.
• Partnership


  Two or more people own and operate the business together, unlimited personal liability, shared liability, and shared decision-making
• What is a sole trader?


  A business owned and run by one person
• What is a partnership?


  A business where two or more individuals share ownership
• How does a sole trader differ from a partnership in terms of ownership?


  A sole trader has one owner, while a partnership has two or more owners
• What is an example of a sole trader?


  A local corner shop run by one person