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Title: Business studies basics - ownership
Description: GCSE AQA Business Studies Notes; Sole traders, partnerships and Private limited Companies. Unit 1 ownerships
Description: GCSE AQA Business Studies Notes; Sole traders, partnerships and Private limited Companies. Unit 1 ownerships
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Business Studies Unit 1
Basics for setting up a business
Why are businesses owned in different ways?
- How big your business is
- How much profit you make
- Number of people that own it
- The amount of customers
- Amount of employees
- Limited/ Unlimited Liability
- How profit is shared
- Locations
- Shareholders
- Number of stakeholders
- Type of product / service
- The way its financed
- Who makes the decisions
- Who’s responsible for the actions of the business
- Who pays the debts
- Aims and Objectives
Sole Traders
Key points for being a sole trader:
- Unlimited Liability (if you cant pay debts personal possesions will be taken instead)
- Easy to set up (register with tax office)
- PAYE (pay as you earn tax)
- Get to keep all profits to themselves
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- Illness / Holidays mean business wont operate
- Can employ staff
- Makes all decisions
- Insurance - Public liability that protects staff and customers, Theft/fire and income
protection
Partnerships
Key points for being a partnership:
- There can be between 2-20 people in a partnership
- Unlimited Liability
- Each partner can make decisions without agreement of others
- There can be disagreements amongst partners
- Partners are jointly responsible for debts
- Different partners bring different skills / specialisation
- Each partner pays tax on their share of the profits
- The business can still run if a partner is sick or on holiday
- More capital available
- Each partner is registered as self employed
- Deed of partnership to complete - who does what and how profit is split
Private Limited Companies LTD
Key points for being an LTD:
- Limited Liability
- Pay corporation tax (20%)
- Easy and inexpensive to set up
- Separate legal existence (the business can be sued but not the owners)
- Must audit accounts to check for accuracy
- Shareholders pay a dividend
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- Board of directors responsible for day to day running
- Shares cant be bought by the public
- More shares=More control ( 51% overall control)
- Owners buy shares in the business - often family / friends
-
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Title: Business studies basics - ownership
Description: GCSE AQA Business Studies Notes; Sole traders, partnerships and Private limited Companies. Unit 1 ownerships
Description: GCSE AQA Business Studies Notes; Sole traders, partnerships and Private limited Companies. Unit 1 ownerships