Types of Business Organisation

Types of Business Organisation

Multiple Choice

One of the claimed advantages of a sole trader business is that:

• owners have limited liability

• shares can be sold to raise capital

• decisions and responsibilities can be shared

• the owner has complete control

Multiple Choice

Select the true statement about sole traders.

• They are run by and employ one person.

• Most small businesses are sole traders.

• All sole traders are public companies.

• Most charities are sole traders.

Multiple Choice

One disadvantage of a sole trader business is that

• capital is limited to the owner's savings and bank loans
• decisions take too long to make
• owners may disagree 

Multiple Choice

One disadvantage of a sole trader business is that

• capital is limited to the owner's savings and bank loans
• decisions take too long to make
• owners may disagree 

Multiple Choice

One of the advantages of a sole trader business is that

• owners have limited liability
• shares can be sold to raise capital
• decisions and responsibilities can be shared
• the owner has complete control over decision making

Multiple Choice

The best definition of a sole trader is a business that

• only employs one person

• is owned by one person

• has a single customer

• is a single firm in the industry

Fill in the Blank

Name the three features of partnership.

Multiple Choice

Name the partnership in which liability of one partner is limited and the liability of remaining partners unlimited.

• Partnership at will

• General Partnership

• Limited Liability Partnership

• Particular Partnership

Multiple Choice

Meaning of Unlimited liability is

• unlimited resources may be use

• Unlimited payment is to be done

• Personal property of proprietor will be use to pay business debt

• unlimited time for business

Fill in the Blank

Identify the type of form of business organisation

Fill in the Blank

In a general partnership liability of partners is .......................

Fill in the Blank

The most important document used in partnership business is.................... .

Multiple Choice

A ________ must name a board of directors that will make the major policy and financial decisions for the business.

• limited liability company
• proprietorship
• corporation
• limited liability partnership

Multiple Choice

A shareholder

• Owns a share in a Sole Trader

• Owns shares in a Private Limited Company

• Owns shares in a Partnership

Multiple Choice

Which is false about private limited companies?

• They are usually family-run businesses.

• They sell shares on the stock market.

• Their shares are owned privately.

• They may be small businesses.

Multiple Choice

Name the document which is not required by public company, if they are following Table F of Company Act

• Article of Association

• Memorandum of Association

• Name approval Letter

• Consent of Proposed directors

Multiple Choice

The main reason why an entrepreneur will convert an LTD into a PLC is

• they don't want to remain in the private sector
• they want to gain the benefits of limited liability
• they want to keep the annual accounts secret
• they want to raise additional capital to expand the business

Multiple Choice

Which of the following is not a feature of a private limited company?

• Shares can be issued to raise capital
• Shares can be bought  and sold on the Stock Exchange
• All owners of the business have limited liability
• The business continues after the death of a shareholder

Multiple Choice

The people who make the major policy and financial decisions in a corporation are the 

• investors
• board of directors
• managers
• owners

Multiple Choice

Which is true about PLCs?

• There must be at least one shareholder.

• The people who own the company are shareholders.

• Shares are available on the stockmarket.

• Shares are never traded on the stockmarket.

Multiple Choice

One of the main disadvantages of a PLC is the

• loss of control by the owners as additional shares are sold
• firms in the public sector are often less efficient
• possibility that if a company fails owners might lose assets