sole traders Flashcards
(6 cards)
1
Q
what is a sole trader?
A
a sole trader is a business owned by one person
2
Q
what is one key feature about being a sole trader?
A
it is a business owned by one person
3
Q
another key feature?
A
the owner invests equity into the business either from personal savings or a bank loan.
4
Q
the last key feature?
A
although there is only one owner they can have many employees.
5
Q
what are the advantages and disadvantages of being a sole trader?
A
advantages-you get to be your own boss and you get to learn new skills
disadvantages-you are responsible for everything and you have unlimited liability.
6
Q
what is unlimited liability?
A
if the business god bankrupt the owner could lose all of their personal possesions (e.g their house) in order to cover the debts of the business.
