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17 Cards in this Set
- Front
- Back
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what is company |
it is a seperate legal identity that engaged in buisiness activities |
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explain sole proprietorship and give disadvantages and advatage 3 |
it is a one man company owned and operstd by a single person and takes all the profits the have unlimited liability (meaning if the company fails the owner has to sell his personal assets or wealth in order pay back the borrowed amounts or debts) and no legal identity advantage financial information remains private keeps all the profits easy to set up disadvantage unlimited liability may have to work long hours no continuity |
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explain partnership with advantages and disadvantages 3 |
a buisiness that is formed by two or more people who agreed to carry on the buisiness and to share profits and loses.there is an agreement called the partnership deed which includes resposibilities duties capital contribution and profit sharing ratio. they have unlimeted liabilty advatages share of workload shared descion making greater access to funds disadvantages unlimited liability conflicts of intrests sharing of profits |
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explain public limited companies with 3 advantages and disadvantages |
it is owned by its shareholders and has a seperate legal identity from shareholders and have limited liability meaning if the company fails the owner will loose the amount of capital they invested in the buisines they can issue shares to the public advantages limited liability continuity seperate legal identity disadvantages need to give dividened to share holders legal formalaties setting up the company need to prepare a prospectus to issue share to the public |
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explain private limited company with3 disadvantages and advantages |
they are small to medium size and cans issue shares to the existing shareholders (friend family relatives) advantages limited liability seperate legal identity continuity disadvantages legal formalities setting up the company not easy to transfer shares financial information are available for the public to see |
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explain the types of documents |
article of association: includes goals OBJECTIVES legal name duties and responsibilities of its members memorandum of association: attributes of shareholders towards the company |
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what are the advantages and disadvantages of mnc |
advantages easier access to raw materials lower production of cost premium pricing disadvantages language barrier poor communication cultural differences |
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what is nationalisation and privatisation |
nationalisation: the government taking over an industry and putting them under the control of the government privatisation:the government owned industries are turned over to private sectors it become owned by a private non government party |
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what is a buisiness |
it is an entity thanyt engages itself in economic activities seeking to make profits through individuals working towards a common goal |
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differenciate private sector and public sector |
private sector buisinesses are those that are run by individuals other than the government institutions and which government has no operational control the have profit motive no stability of income and flexible to change BUT public sector buisiness are operated and controlled by the government of a country they have a service motive higher stability of income but not flexible to change. |
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define multi national company and the other name for it and examples |
it is an organisation operating in more than one country also known as trans national company eg: STO, hilton,john keels home country is the hq the domestic countrywhere the company starts host country is the foreign country where operations are set up |
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what is franchise |
franchise is a system where entreprenuers buy the right to use a companys logo name products nd methods of production . the agreement between a franchisor(seller) and franchisee(buyer) is called a franchise agreement. |
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what is franchising |
Franchising is an arrangement where franchisor grants or licenses some rights and authorities to franchisee. |
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what is joint venture |
two or more buisiness gree to work together on an projet and set up a seperate buisiness fo this purpose . the parties contribute their resources bsed on the joint venture agreement which defines the roles responsibilities and limitatins in liability each party has. they are a short ter contractual agreemet(1-3 years) |
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what are two differences between limited an unlimited liability |
1- unlimited liability is when buisiness fails the owner has to sell his personal wealth or assets in order to pay back the borrowed amounts or debts. 2- sole proprotership partnership both have unlimited liability 1- limited liability is when the buisiness fails the owner loose all the monrey they invested in the buisiness. 2- limited liability companies have limited liability |
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what are the differences between public limited companies and public sector coorparations |
public limited company: owned by its shareholders seperate legal identity from its shareholders profit motive
public sector coorparations: owned by the government legal identity is established by the government service motive |
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what is the difference between franchise and mnc |
MNC: owned and operated by home country less risk franchise: owned by franchisor operated by franchisee more risk |
