Business ownership

• What is one advantage of being a sole trader?

  Quick and easy to set up.
• What is a key responsibility of a sole trader?

  The owner makes their own decisions.
• What financial benefit does a sole trader enjoy?

  The sole trader keeps all the profits.
• What is a disadvantage of being a sole trader?

  Risk of unlimited liability.
• What is another disadvantage of being a sole trader?

  Works long hours.
• What is a responsibility of a sole trader regarding business roles?

  The owner performs many different roles in the business.
• What type of businesses are typically sole traders?

  Usually start-ups or small businesses like electricians or hairdressers.
• What does unlimited liability mean for a sole trader?

  The owner is personally responsible for the debts and losses of the business.
• How do sole traders pay taxes on their earnings?

  They pay income tax on their earnings.
• What is one advantage of partnerships?

  Usually quick and easy to set up.
• How is decision-making handled in a partnership?

  Shared decision-making by the owners.
• What is a benefit of having partners in a business?

  Partners bring more skills and ideas.
• What is a disadvantage of partnerships regarding profits?

  Profits have to be shared between partners.
• What is a potential conflict in partnerships?

  Conflict can occur among partners.
• What is a disadvantage of partnerships related to liability?

  Risk of unlimited liability.
• What type of businesses typically form partnerships?

  Businesses that provide professional services like lawyers and doctors.
• What is a deed of partnership?

  A document outlining the rules agreed upon by the owners.
• How do partners in a partnership pay taxes?

  They pay income tax on their earnings.
• What is a characteristic of a private limited company?

  Often have 'ltd' after the business name.
• Who are the owners of a private limited company?

  Owners are known as shareholders.
• What is a share in a company?

  A share is a portion or percentage of a company.
• What type of tax do private limited companies pay?

  They pay corporation tax.
• What is corporation tax?

  It is a tax on the profits of a business.
• What must happen for shareholders to purchase shares in a private limited company?

  Shareholders have to be invited by the business.
• What is one advantage of a public limited company?

  Ability to raise additional finance through share capital.
• What is a disadvantage of a public limited company regarding setup?

  Expensive to set up.
• What is a risk associated with public limited companies?

  Greater risk of a hostile takeover.
• What do shareholders expect from a public limited company?

  Shareholders expect to receive a percentage of the profits as dividends.
• What is a potential conflict in public limited companies?

  Shareholders may clash when making decisions about the business.
• What is a characteristic of not-for-profit organizations?

  They aim to do something other than to make profit.
• What is an example of a not-for-profit organization?

  A charity.
• How are businesses with charitable status funded?

  They are funded mainly by donations.
• What is a social enterprise?

  An organization that aims to help society and uses profits to benefit society.
• What is the definition of a sole trader?

  A business owned by one person.
• What is the definition of a public limited company?

  A company that is able to offer its shares to the public.
• What is the definition of a private limited company?

  A company owned by one or more shareholders.
• What is the definition of a partnership?

  A type of business that has between 2 and 20 owners.
• What is the definition of a not-for-profit organization?

  A business that aims to do something other than make profit for the owners.
• What are the pros and cons of being a sole trader?

  Pros:

  • Quick and easy to set up
  • Makes own decisions
  • Keeps the profits
  • Low set-up cost

  
  

  Cons:

  • Risk of unlimited liability
  • Works long hours
  • High level of responsibility
  • Owner performs many different roles
• What are the pros and cons of partnerships?

  Pros:

  • Usually quick and easy to set up
  • Shared decision-making by the owners
  • Shared responsibility for debt
  • Partners bring more skills and ideas
  • More capital available to invest

  
  

  Cons:

  • Involves long work hours
  • Profits have to be shared between partners
  • Conflict can occur
  • Risk of unlimited liability
  • Owners can get people down in the business