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16 Cards in this Set
- Front
- Back
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Public sector organisations are: |
Run by the government. They aim to provide services to the public rather than make a profit. E.g. NHS hospitals - they are funded by the U.K. Tax system. |
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Private sector organisations are: |
Owned and run by private individuals. E.g. John Lewis and ASDA Aim to make a profit (except charities) |
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What are the different forms of business? |
• sole traders •private limited companies •public limited companies |
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Liability to pay off business debts can be: |
Limited or unlimited |
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Unlimited liability means: |
The business and the owner are seen as one under the law. This is the case for sole traders.
•business debts become personal debts of the owner. Sole traders can be forced to sell personal assets like their house to pay off business debts. Unlimited liability is a huge financial risk. |
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Limited liability - your okay! Your not in trouble if you go bankrupt!😅 |
Limited liability means the owners aren't personally responsible for the debts of the business. The owners of both private and public limited companies have limited liability, because a limited company has a separate legal identity from its owners. The most the shareholders can loose is the money invested in the company. |
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Sole trader businesses (is run by an individual) (individual trading in his or her own name) |
Sole traders are self employed for example shop keepers hairdressers. They have unlimited liability (responsible for any debts) |
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Sole trader businesses (is run by an individual) (individual trading in his or her own name) |
Sole traders are self employed for example shop keepers hairdressers. They have unlimited liability (responsible for any debts) |
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Advantages and disadvantages of being a sole trader? |
Advantages: freedom, profit, simplicity, savings on fees
Disadvantages: risk, time, expertise, finance, vulnerability, unlimited liability. |
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Two types of limited liability companies? |
Private limited companies (Ltds) and public limited companies (PLCs) |
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Two types of limited liability companies? |
Private limited companies (Ltds) and public limited companies (PLCs) |
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Private limited companies and public limited companies characteristics |
Back (Definition) |
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Dividends is the? |
Sum of money paid regularly (typically annually) by a company to its shareholders out of its profits. |
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Dividends is the? |
Sum of money paid regularly (typically annually) by a company to its shareholders out of its profits. |
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Ordinary shared capital = |
Money invested by its shareholders (long term source of finance) in return for investment, shareholders gain a share of ownership and annual profit through dividends. |
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Market capitalisation = |
The total value of all ordinary shares issued by a company.
Market capitalisation = number of issued shares x current share price. |
