starter answer the following questions on your whiteboards 1.define sole trader. 2.what is unlimited...

Starter

• Answer the following questions on your whiteboards

1. Define sole trader.2. What is unlimited liability?3. List 2 advantages of being a sole

trader.4. List 2 disadvantages of being a

sole trader.

Partnerships

Objectives

• To identify the features of a partnership (E)

• To analyse the benefits and drawbacks to a partnership. (C)

• To evaluate why a business would form as a partnership. (A)

What is a partnership?• A business agreement

between 2-20 people, but could have more staff

• They have unlimited liability

• Examples:-– Vets– Doctors– Solicitors

How to set up a Partnership?• A Deed Of Partnership needs to

be completed. This shows:- – The money put in– Roles and responsibilities– How the agreement can be

ended

Anything not covered in this agreement is covered by the Partnership Act 1890

Sleeping Partners• These are people

who have invested money into the company but have no active part in running the business

• They have limited liability

Advantages Vs Disadvantages

• In pairs come up with the advantages and disadvantages you believe a partnership to have.

Advantages of Partnerships

• Spreads the risk more than being a sole trader

• New skills can be brought to the business

• More money and resources are brought to the business

• Accounts are kept private

Disadvantages of Partnerships

• Unlimited liability• Sharing the profits• Less control of the business• Disputes over workload• Partnership has to be reformed if a

partner dies

Task

• Complete the true or false activity handed out.

Activity

• In groups you should form your own partnership and each create a deed of partnership detailing the particulars of the business you are creating.

Video

• Watch the following short video which will talk about the different forms a business can take. You have covered 2 of them, but what are the other ones mentioned?

• Can you make a note of what they are and their advantages and disadvantages?