sole traders

Question 1

sole trader

Answer 1

unincorporated

• business that is owned by 1 person , who retains all profits generated by business

Question 2

pro of sole trades

Answer 2

1- simple/quick to set up, cheap to set up

2. retain all prfoits
   no shareholders, no partners
3. decision making
   control over business

Question 3

cons of sole trades

Answer 3

unlimited liabilty
- personal assets at risks if fails

• less sources of finance available , can’t issue shares, expansion is harder

Question 4

PLUMS sole trader to plm

Answer 4

P - slower expansion , but 100% profit

LU - does sole trader have car/house, if not then not much at risk

M= desire for full control?

S = need for finance ?