Possible meanings of "Legal form of business"

[Marc]

Hi, i have had the following question posed to me can anyone offer an
explanation of what is meant by "legal form" it seems to mean things like
PLC, LTD, Partnership but if so i could not really write a long essay on it
so i was wondering whether anyone sees a different more complex meaning in
the term:

"Maxine and Buffy have a talent for making and baking elaborate wedding
cakes. They believe that baking might be a lucrative way to earn a living
and wish to set up business as bakers/confectioners:

What would be the most suitable legale form through which Maxine and Buffy
should carry out there business and why?"

If this question does indeed ask for a comparison of forms like LTD,
partnership etc can anyone advise as to how i could make the answer last
about an hours writing.
Thanks a lot,

Marc

[Clive]

Post by Marc
"Maxine and Buffy have a talent for making and baking elaborate wedding
cakes. They believe that baking might be a lucrative way to earn a living
What would be the most suitable legale form through which Maxine and Buffy
should carry out there business and why?"
If this question does indeed ask for a comparison of forms like LTD,
partnership etc can anyone advise as to how i could make the answer last
about an hours writing.

That is indeed what they are looking for, (however I am suprised that you
want to spend an hour answering it). What is the question for (i.e GCSE,
degree etc)?

Just go though the various forms and discuss the benefits and disadvantages
of each one. At the end then state which business form would be most
appropriate.

[R. Mark Clayton]

Post by Marc
Hi, i have had the following question posed to me can anyone offer an
explanation of what is meant by "legal form" it seems to mean things like
PLC, LTD, Partnership but if so i could not really write a long essay on it
so i was wondering whether anyone sees a different more complex meaning in
"Maxine and Buffy have a talent for making and baking elaborate wedding
cakes. They believe that baking might be a lucrative way to earn a living
What would be the most suitable legale form through which Maxine and Buffy
should carry out there business and why?"
If this question does indeed ask for a comparison of forms like LTD,
partnership etc can anyone advise as to how i could make the answer last
about an hours writing.
Thanks a lot,
Marc

Sole trader = person trading on their own account, no limit of liability
Firm = person(s) trading on their own account, no limit of liability
Partnership = person(s) trading on their own account, no limit of liability,
but legal recognition of their status. Usually professionals e.g lawyers,
accountants, who until recently were not allowed to limit liability.
Ltd. Co. = persons trading with limited liability with separate legal
identity.
plc. = persons trading with limited liability with separate legal identity
and the right to offer shares in the company to the public.
quoted plc. = persons trading with limited liability with separate legal
identity and the shares are tradable on a public exchange
limited partnership = person(s) trading on their own account with a limit of
liability and legal recognition of their status. (relatively new so look it
up).

Very small business, with no downside -> firm / sole trader.

Small business, risk, potential liability -> ltd. co.

Medium business, -> unquoted plc.

large business -> quoted plc.

Profs -> [limited] partnership