Understanding Business Organisations

Front

What is a sole proprietorship?

Back

A sole proprietorship is a business owned and operated by one person, with no legal separation between the owner and the business.

Front

How many owners does a sole trader business have?

Back

1

Front

What type of liability does a sole proprietor face?

Back

Unlimited personal liability

Front

Can a sole trader enter into contracts on behalf of the business?

Back

Yes, a sole trader can enter into contracts on behalf of the business.

Front

What is the main advantage of operating as a sole trader?

Back

Simplicity and full control over the business.

Front

What distinguishes a general partnership from a limited partnership?

Back

A general partnership has equal liability for all partners, while a limited partnership has both general and limited partners with different levels of liability.

Front

In a limited partnership, who has limited liability? Options: Managers, Shareholders, General partners, Limited partners

Back

Limited partners

Front

Limited Liability Partnership (LLP)

Back

A business structure where partners have limited liabilities and are not personally responsible for the debts of the partnership.

Front

What are companies limited by shares primarily used for?

Back

To raise capital and limit shareholder liability.

Front

What is the key characteristic of an unlimited company?

Back

Members have unlimited liability.