Types of Business Enterprises and Forms of Share Capital and Long-Term Debt

Accounting

TABLE OF CONTENTS
INTRODUCTION...........................................................................................................................3
MAIN BODY...................................................................................................................................3
Three different types of the business enterprises........................................................................3
Difference between two forms of share capital and two forms of long term debt......................4
CONCLUSION................................................................................................................................5
REFERENCES................................................................................................................................6

INTRODUCTION
Accounting is being referred to as recording of all the financial transactions and
summarising and interpreting the results to the interested parties. For the business accounting is
very essential in order to evaluate that how much profitable the business is. The current report
will outline the various types of business which can be used or exist within the business
environment. Along with this the distinction between the various forms of share capital and the
long-term debt will be outlined within the study.
MAIN BODY
Three different types of the business enterprises
There are different forms of business which can be operated by a person or anyone in
order to buy or sell their products and services within the business environment (Steward and Li,
2018). All these different types of business enterprises have their own distinct features and
benefits. The three different types of business enterprises are as follows-
Sole trader- The sole trader is a type of business where in the individual run the business
on their own. There is no involvement of any other person and all the risk and profits are being
made by the sole trader only (Etim, 2020). All the decisions and responsibilities also rest within
the hands of the sole trader only and no other person can interfere within the working. For
example Ebay
Partnership- On the other hand the partnership is a type of business enterprise where two
or more person comes together in order to run the business with some common objectives.
Within the partnership all the things are decided by both the partners mutually and all the
decisions are also taken by the consent of every partner (Lapinskaya and Manukovskaya, 2019).
The partnership under the UK has been governed by the partnership act 1890. The partnership is
not a separate legal entity and the partners are having unlimited liability. For example, Uber and
Spotify, Apple and Master card and many others.
Companies- The company is another type of business enterprise where in the organisation
is formed in order to sell and buy the goods and services in order to make profits (Wynn and
Jones, 2019). The company can also be referred to as an artificial person or an invisible person
who is being created by the people in order to work. Under the company there is limited liability