Let us discuss some more terms related to management. There are different forms of business organizations.
A person invests some money, say in a trading activity. He is the sole PROPRIETOR. He owns the business. Any profit or loss occurring in the business will be on his account only. None else would be affected. This type of business organization is called PROPRIETORSHIP. This sort of business organization may not involve huge capital.
What is CAPITAL?
It is the amount of money required to start and run an enterprise. The money needed to run the business is called the WORKING CAPITAL. When one purchases the required goods to start a business,such goods are known as CAPITAL ASSETS. Generally machineries, lands etc are fixed assets. What assets are required for an enterprise depends on the nature of the enterprise. A manufacturing unit may require machineries, lands and labour.
Another type of business organization is PARTNERSHIP. The minimum number of partners would be two. Each partner invests some money in the business. In other words,each has a share in the business. The profit or loss is shared in proportion to their share capital.
COMPANY is another type of business organization. A strict legal definition is available depending on the laws of the particular country. That need not bother us now. A company issues shares. The liability of the shareholders in the event of debts of the company is limited to the number of shares owned by the shareholder. So the company is called a LIMITED COMPANY.
When the shares of a company are sold to public at large,such a company is called a PUBLIC LIMITED COMPANY. If the shares are owned by private individuals only,then the company is called a PRIVATE LIMITED COMPANY.
In USA, the word CORPORATION denotes a company. Normally, corporations are huge organization. When such corporations function in different countries, they are known as MULTI NATIONAL CORPORATIONS.
In British English, corporation denotes civic or municipal corporations and not a business company.
Another name for a multinational corporation is TRANSNATIONAL CORPORATION.
START-UP refers to a company that is just beginning to operate. This term is mostly referred to an Internet company. This word can be used as an adjective also.
START-UP costs,START-UP problems etc.
When the government of a country owns a business enterprise, it is known as PUBLIC ENTERPRISE or STATE ENTERPRISE.
There are also PRIVATE ENTERPRISES AND JOINT ENTERPRISES. Joint ENTERPRISES are owned both by the government and private shareholders.
That is all for today.
Happy learning.
Sayee Jayaraman
26/02/2015
f business organizations.
A person invests some money, say in a trading activity. He is the sole PROPRIETOR. He owns the business. Any profit or loss occurring in the business will be on his account only. None else would be affected. This type of business organization is called PROPRIETORSHIP. This sort of business organization may not involve huge capital.
What is CAPITAL?
It is the amount of money required to start and run an enterprise. The money needed to run the business is called the WORKING CAPITAL. When one purchases the required goods to start a business,such goods are known as CAPITAL ASSETS. Generally machineries, lands etc are fixed assets. What assets are required for an enterprise depends on the nature of the enterprise. A manufacturing unit may require machineries, lands and labour.
Another type of business organization is PARTNERSHIP. The minimum number of partners would be two. Each partner invests some money in the business. In other words,each has a share in the business. The profit or loss is shared in proportion to their share capital.
COMPANY is another type of business organization. A strict legal definition is available depending on the laws of the particular country. That need not bother us now. A company issues shares. The liability of the shareholders in the event of debts of the company is limited to the number of shares owned by the shareholder. So the company is called a LIMITED COMPANY.
When the shares of a company are sold to public at large,such a company is called a PUBLIC LIMITED COMPANY. If the shares are owned by private individuals only,then the company is called a PRIVATE LIMITED COMPANY.
In USA, the word CORPORATION denotes a company. Normally, corporations are huge organization. When such corporations function in different countries, they are known as MULTI NATIONAL CORPORATIONS.
In British English, corporation denotes civic or municipal corporations and not a business company.
Another name for a multinational corporation is TRANSNATIONAL CORPORATION.
START-UP refers to a company that is just beginning to operate. This term is mostly referred to an Internet company. This word can be used as an adjective also.
START-UP costs,START-UP problems etc.
When the government of a country owns a business enterprise, it is known as PUBLIC ENTERPRISE or STATE ENTERPRISE.
There are also PRIVATE ENTERPRISES AND JOINT ENTERPRISES. Joint ENTERPRISES are owned both by the government and private shareholders.
That is all for today.
Happy learning.
Sayee Jayaraman
26/02/2015
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