Edina Szigeti LCC20123482
Understand the organisational purposes of businesses
Identify the purposes of different types of organization (P1)
A business organization is an individual or group of people that collaborate to achieve certain commercial goals. Some business organizations are formed to earn income for owners. Other business organisations, called nonprofits, are formed for public purposes. These businesses often raise money and utilise other resources to provide or support public programs.
Table no 1: Types of Business Orgnisations
By types of business organisations various legal forms of ownership are meant. In countries with "mix economies"some industries and services are owned and controlled by the government (public sector) while others are owned and controlled by private enterprise (private sector).
Sole Trader /Proprietorship: is a business that is owned and run and controlled by one person or family for profit..The owner provides all the capital required by the business and is totally responsible for its success or failure.
Many sole traders provide specialist services such as plumbing, decorating and hairdressing. The sole proprietor is called an entrepreneur and he or she is self-employed
Partnership: A partnership is a business organisation owned by two or more people and the partners equally share the risk and the profit.General partnership has unlimited liability.Partnerships are particularly common in professional services e.g. accountants, solicitors, vets.
Companies: A company is owned by shareholders who appoint Directors to give direction to the business. The Chief Executive is the senior official within the company with responsibility for making major decisions. Specialist managers will be appointed to run the company on behalf of the Board. Every company must register with the Registrar of Companies, and must have an official address. Private companies have Ltd after their name. Shares in a...