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Principle Of Business > Legal Aspects Of a Business > Flashcards

Legal Aspects Of a Business Flashcards

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1
Q

What is a contract?

A

A contract is a legal binding agreement between two or more persons that is enforceable by law

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2
Q

What is a simple form

A

A simple form requires no special forms and may be written or oral

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3
Q

What is a speciality contract?

A

A speciality contract that is also called a deed or a contract under seal

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4
Q

What should a speciality contract must have

A

Seal
Signature of party
Deliver to all parties involved

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5
Q

Characteristics of simple contract

A

Offer and acceptance,an offer has to be made and there must be a clear unconditional acceptance

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6
Q

Parties of a contract

A

Offeror
Offeree

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7
Q

Explain offeror

A

The person who makes the offer

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8
Q

Explain offeree

A

The person who accepts the offer

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9
Q

What is form of consideration

A

Is the exchange of one thing of value for another

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10
Q

Under consideration contract they are two types of agreement,what are they

A

Bilateral agreement and unilateral agreement

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11
Q

Explain bilateral

A

Where both parties exchange promise with each other

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12
Q

Explain unilateral

A

One party make a promise in exchange for performance

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13
Q

Persons who cannot sign a contract

A

Person of unsound mind
Person under the influence
Alien
Minors

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14
Q

What is good faith in the contract

A

There should be no fraud

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15
Q

What is genuiness in a contract

A

The party must agree to the contract on their own free will

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16
Q

What is possibility in a contract

A

The party must be able to deliver on the agree up on contract

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17
Q

Characteristics of a speciality contract

A

Signing
Sealing

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18
Q

Rules of offer and acceptance

A

The offer must be communicated by the other party

The offer must be general and must be accepted by the specific person that you offer

The offer can be Revoked at any time before acceptance

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19
Q

Several ways that a contract is terminated or discharged

A

1.mutual agreement
2.breach of contract
3.performance
4.impossibility
5.death
6.bankruptcy
7.lapse of time

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20
Q

Mutual agreement

A

This is when both parties agreed to cancel the agreement before it is performed 

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21
Q

Reach of contract 

A

One party side of the contract

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22
Q

Performance

A

When a contract is not fulfilled and completed

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23
Q

Impossibility

A

This is where one or both parties find it humanly impossible to comply with the contract

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24
Q

Death

A

This is where one of the party involved in the contract dies

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25
Bankruptcy
When one party loses all their money and assets and to uphold the contract
26
Lapse of time
This is where non-performance of one party has a breach in the contract during a specified time. Period.
27
Letter of enquiry
This is used when people are organization wishes to find information about a product
28
Invoice
One of the most important documents is an invoice. This document goes from the seller to the buyer, informing the buyer of what he or she holds
29
Factors of production
Land(natural resources) Labour(Human Resources) Capital(man made resource) Enterprise
30
What is production
Production is the creation of goods and services to satisfy the needs n wants
31
Define productivity
A measure of how efficiently resources are combined and utilized in the firms for achieving the desired outcome
32
What is capital
Capital is anything that is money which is use to start or secure a business
33
Eg of capital
Money,loan or personal assets
34
What is a small business
A privately owned corporation partnership or sale partnership that has fewer employees and less annual revenue than a corporation or regular sized business
35
Micro enterprises has how man employees
Fewer than 10 employees
36
Small enterprises has how many enployees
10-49
37
Medium sized enterprise has how many employees
50-249
38
Large enterprises have how many employees
250 or more people
39
Functions of a small business
Supplying goods and services that satisfy demand Creating employment Making a profit
40
Advantages of a small business
Increase competition for larger firms Generate employment and income Introduced new products and ideas
41
Disadvantages of a small business
The business lacks enterprise in certain areas Limited ability to service customers due to unavailable resources Owner find it difficult sourcing finance from financial institution
42
Three benefits of having a partnership business
Responsibilities can be shared Easy to manage Emotional support
43
What is an entrepreneur
person who sets up a business or businesses, taking on financial risks in the hope of profit.
44
What is enterprise
This refers to the taking of risks in establishing a business
45
Loss
When total sales are not enough to cover all expenses
46
Organization
A social arrangement which pursues collective goals such as the production of goods and services.
47
Economy
The system within a country which determines the production, exchange and consumption of goods and services.
48
Exchange
The voluntary trade of goods and services.
49
Market
Any place where buyers and sellers meet to engage in trade. It is also referred to as the demand for a product.
50
Market
Any place where buyers and sellers meet to engage in trade. It is also referred to as the demand for a product.
51
Commodity
Any final good used for some purpose.
52
Capital
Money which is used in the organisation to acquire assets. It also refers to items (factories, equipment, machinery etc.) used to create final products.
53
Labor
This is the physical and mental contribution of individuals to the creation of goods and services.
54
Specialization
This is the division of labour into specific tasks. A whole process is divided into several tasks. This helps to speed up the process and may result in an increase in productivity and a decrease in unit cost.
55
Characteristics of money
To be divisible To be durable or long lasting To be portable and easy to carry around
56
Cheques
Payment represented on paper to be taken from consumer’s bank account.
57
Sole trader
A person who owns his or her business
58
Characteristics of sole trader
Easy to set up Financed by the owner Bears all risk and keep all profits
59
Advantages of sole trader
Takes all profit Decision can be made quicker
60
Disadvantages of sole trader
Lack of specialized staff Long working hours Business usually dissolves if owner dies
61
Partnership
An association between 2- 20 people operating a business with the common goal of making a profit.
62
2 types of partnerships
Ordinary Limited
63
Advantages of partnership
Easy to set up Shared work load Business will not end if one partner dies
64
Disadvantages of partnership
Unlimited liability Difficulty in raising capital Personalities of partners may cause difficulties in decision making.

Principle Of Business (3 decks)

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