Business Structures

Question 1

What is two advantages of a Sole trader?

Answer 1

• Can own all their profits

- Work the hours they like

Question 2

What is two advantages of a Partnership

Answer 2

• Partners can share skills and expertise

- Can share the risk and responsibility of the business

Question 3

What is two advantages of a Company

Answer 3

• Limited Liability

- Unlimited lifetime

Question 4

What is two disadvantages of a Sole trader

Answer 4

• Takes responsibility of company

- Unlimited Liability

Question 5

What is two disadvantages of a Partnership

Answer 5

• Unlimited Liability

- Control is shared

Question 6

What is two disadvantages of a Company

Answer 6

• Directors need to understand their responsibilities

- Higher cost of entry

Question 7

What is unlimited liability

Answer 7

If the business fails, the personal assets of the owner can be used to repay business debts.

Question 8

What is limited liability

Answer 8

If the business fails, the personal assets of the owner cannot be used to repay business debts.