Edexcel Business A Level Revision

Liability - is a company's financial debt or obligations that arise during the course of its business Limited liability - An investor's liability/financial commitment is limited to the total amount invested or promised in share capital. An investor's personal belongings beyond this venture are protected. Unlimited liability - The owners of a business are responsible for the total amount of debt of the business. The owner may lose their personal belongings, e.g. home and cars, if the value of these is needed to cover the debts of the business. UNLIMITED LIABILITY IS SEEN AS A HIGH RISK Incorporated - An incorporated business (also called a corporation) is a type of business that offers many benefits over being a sole proprietor or partnership, including liability protection and additional tax deductions. Forming a corporation also allows you raise capital through sale of shares of your company . Creditors - is owed money, either by a business or an individual f...

Business angels -   Usually high-net worth individuals who invest either directly or via network syndicates into start-up businesses in return for a share of the business i.e. percentage equity. Can be seen as high risk as the business is not established but angels will assess the potential for reward. The entrepreneur will need to demonstrate a good understanding of their business model and present a detailed business plan in order to secure the investment. BUSINESS ANGELS MAY ALSO OFFER SUPPORT AND EXPERTISE , ADVANTAGES OF BUSINESS ANGELS They are normally very knowledgeable and experienced in business matters; may act as a mentor for the business, providing advice and guidance. DISADVANTAGES OF BUSINESS ANGELS May require some form of equity (share) which gives them a measure of control. BEST FOR .... newer and possibly high risk, early stage or high growth business.