finance and ownership
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![Page 1: Finance and ownership](https://reader034.vdocument.in/reader034/viewer/2022042623/548c3410b47959bc0e8b474d/html5/thumbnails/1.jpg)
To be able to distinguish between unlimited liability and limited liability businesses
Private Limited Companies
1. Sole Traders
2. Partnerships
3. Private Limited Companies
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To be able to distinguish between unlimited liability and limited liability businesses
2 types of business
Unlimited liability businesses
- like sole traders and partnerships
Limited liability businesses
- These are called companies
![Page 3: Finance and ownership](https://reader034.vdocument.in/reader034/viewer/2022042623/548c3410b47959bc0e8b474d/html5/thumbnails/3.jpg)
To be able to distinguish between unlimited liability and limited liability businesses
2 types of business
Unlimited liability businesses
- like sole traders
If you go bust there is
no limit to what you
can lose
Limited liability businesses
- These are called companies
If you go bust what you
lose is limited to what
you put into the business
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To be able to distinguish between unlimited liability and limited liability businesses
Sole trader - Business and owner are one
![Page 5: Finance and ownership](https://reader034.vdocument.in/reader034/viewer/2022042623/548c3410b47959bc0e8b474d/html5/thumbnails/5.jpg)
To be able to distinguish between unlimited liability and limited liability businesses
![Page 6: Finance and ownership](https://reader034.vdocument.in/reader034/viewer/2022042623/548c3410b47959bc0e8b474d/html5/thumbnails/6.jpg)
To be able to distinguish between unlimited liability and limited liability businesses
Company - Business and owner are separate
![Page 7: Finance and ownership](https://reader034.vdocument.in/reader034/viewer/2022042623/548c3410b47959bc0e8b474d/html5/thumbnails/7.jpg)
To be able to distinguish between unlimited liability and limited liability businesses
![Page 8: Finance and ownership](https://reader034.vdocument.in/reader034/viewer/2022042623/548c3410b47959bc0e8b474d/html5/thumbnails/8.jpg)
To be able to distinguish between unlimited liability and limited liability businesses
Business Ownership
What are the two ways of setting up in business?
Which would you prefer? Why?
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To be able to distinguish between unlimited liability and limited liability businesses
Statement T or F
If you are a private limited company you must sell shares to raise money.
The shareholders with the most shares have most control over the business.
Being a shareholder is risky. If the business goes bankrupt, you may lose all your assets.
Limited companies are usually bigger businesses than sole traders.
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Finance for....
Fixed assets
1.Retained profit
2.Share capital
3.Bank loan
4.Hire purchase
5.Leasing
Working Capital
[to help cash flow]
1.Trade credit from suppliers [creditors]
2.Overdraft from the bank
[current liabilities]
to be able to describe different sources of finance
![Page 11: Finance and ownership](https://reader034.vdocument.in/reader034/viewer/2022042623/548c3410b47959bc0e8b474d/html5/thumbnails/11.jpg)
Finance for....
Fixed assets
1.Retained profit
2.Share capital
3.Bank loan
4.Hire purchase
5.Leasing
Working Capital
[to help cash flow]
1.Trade credit from suppliers [creditors]
2.Overdraft from the bank
[current liabilities]
to be able to describe different sources of finance
p.85
p.85
p.84
p.85
p.85p.85
p.86
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to be able to describe different sources of finance
Shareholders own the business. They put in money in return for a share in the business. At the end of each year the business hopes to make a profit. One part is kept in the business. This is called r………………. p………………
The rest is paid to shareholders as d……………….. .
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The business cannot afford the van. So, the ………..loans the money to ………………….
The business then pays the bank ……………..The bank makes a profit by charging …………………..
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Comparing options
Raising capital by borrowing is good because …..
A disadvantage of borrowing is….
Raising capital by selling shares is good because ….
A drawback however is….
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to be able to describe different sources of finance
![Page 17: Finance and ownership](https://reader034.vdocument.in/reader034/viewer/2022042623/548c3410b47959bc0e8b474d/html5/thumbnails/17.jpg)
to be able to describe different sources of finance
p.85
![Page 18: Finance and ownership](https://reader034.vdocument.in/reader034/viewer/2022042623/548c3410b47959bc0e8b474d/html5/thumbnails/18.jpg)
to be able to describe different sources of finance
![Page 19: Finance and ownership](https://reader034.vdocument.in/reader034/viewer/2022042623/548c3410b47959bc0e8b474d/html5/thumbnails/19.jpg)
Comparing options
Buying an asset by hire purchase is good because …..
A disadvantage of hire purchase is….
Buying an asset by leasing is good because ….
A drawback however is….
![Page 20: Finance and ownership](https://reader034.vdocument.in/reader034/viewer/2022042623/548c3410b47959bc0e8b474d/html5/thumbnails/20.jpg)
Finance for....
Fixed assets
1.Retained profit
2.Share capital
3.Bank loan
4.Hire purchase
5.Leasing
Working Capital
[to help cash flow]
1.Trade credit from suppliers [creditors]
2.Overdraft from the bank
[current liabilities]
to be able to describe different sources of finance
![Page 21: Finance and ownership](https://reader034.vdocument.in/reader034/viewer/2022042623/548c3410b47959bc0e8b474d/html5/thumbnails/21.jpg)
to be able to describe different sources of finance
Shareholders own the business. They put in money in return for a share in the business. At the end of each year the business hopes to make a profit. One part is kept in the business. This is called r………………. p………………
The rest is paid to shareholders as d……………….. .
![Page 22: Finance and ownership](https://reader034.vdocument.in/reader034/viewer/2022042623/548c3410b47959bc0e8b474d/html5/thumbnails/22.jpg)
to be able to describe different sources of finance
![Page 23: Finance and ownership](https://reader034.vdocument.in/reader034/viewer/2022042623/548c3410b47959bc0e8b474d/html5/thumbnails/23.jpg)
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