What are the three sub sections of the private sector?
Sole traders, Partnerships, Limited companies
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Who owns a sole trader business entity?
Owned by one person
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Whats unincorporated mean? (besides above)
The owner is responsible for any action or inaction of the business
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there financial recods are..
unrestricted or no regulation
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Who owns a partnership business entity?
Two or more people
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Is a partnership business entity unincorporated?
If they choose to be
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What puts the owners private wealth and investment at stake?
Unlimited liability
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Whats Limited Liability?
Only liable for the extent of there investment
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Can they be involved in managing the business if they choose to have limited liability?
No
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What is a deed of partnership?
Outlines each partners rights and responsiblity
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What does it prevent?
Misunderstanding
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What happens if they have no deed of partnership?
Profits and losses are equal between partners by the capital and contribution they invest
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What is this goverened by?
Partnership act 1890
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Are limited companies public or private sector?
Both
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Who owns a limited company?
Shareholders
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What does it mean if a business entity is incorporated?
Seprate from its owners
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As a living person in the eyes of the law can a limited company sue or be sued?
Yes
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Can it enter a contract?
Yes
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What must a private limited company do?
Have it's name end in limited (Ltd)
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What must a public limited company do?
End its name with public limited company (plc)
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A Privated company cannot?
Sell it's shares to the general public
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Can a public limited company sell it's shares to the general public when its listed on the stock exchange?
Yes
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The capital private limited companys can raise from shares is?
Less than 50,000
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The capitalpublic limited companys is legally required to raise from shares is?
At least 50,000
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Do share holders have limited liablility?
Yes
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So If an individual invested in a company by buying 5,000 shares at £1 each then, should the company fail, the maximum amount they could lose is?
£5,000
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What determines the requirements relating to the keeping of financial records and the preparation and presentation of financial statements on their behalf?
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