Business Enterprises Report: Share Capital and Long Term Debt

This report provides an overview of different types of business enterprises, including sole traders, partnerships, and companies, highlighting their unique characteristics and examples. It distinguishes between equity and preference shares and explores long-term debt instruments like debentures and corporate bonds, examining their implications for listed public limited companies. The analysis emphasizes how businesses utilize these financial instruments to manage growth and investment strategies. This document is available on Desklib, a platform offering a range of study tools and solved assignments for students.

Type of business enterprises
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Table of Contents
Introduction.....................................................................................................................................3
Main Body.......................................................................................................................................3
Why do you think that there are different types of business enterprises exist? Use specified
examples.....................................................................................................................................3
Distinguish between the two forms of share capital and two forms of long term debt in the
context of long term sources of finance of listed public limited companies.............................4
Conclusion.......................................................................................................................................5
References.......................................................................................................................................6
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Introduction
The choice of business organisation is one of the significant choice that is based on the
working style of the company. In an organisation there are different factors which affect the
decision making of the company with an appropriate channels. There are different forms of
business organisation which are able to choose and operate when a company is forming with
having their own structure and rules (Blount, 2021). This reports, include two major concepts of
different types of business enterprises. In addition to this, two forms of share capital and long
term debts are used by the public listed company in different manners.
Main Body
Why do you think that there are different types of business enterprises exist? Use specified
examples.
In the market, business exist as because they are formed by the enterpriser and developed
on the basis to manage the survival stage. Most of the businesses are exist on the basis to earn
returns for the growth of business and make effective motive for entrepreneurial activities. There
are mainly three type of business organisation exist into the market. These are related to Sole
traders, Partnership and companies.
Sole traders: A sole trader is the unincorporated company that is owned by an individual
and do simple type of business activities in different ways. This type of company provide a least
amount of share financial and legal protection to their owner. They are not able to create separate
legal entity for the growth of business activities (Capiña, 2021). For example, James Milne
Chartered Accountant firm in Scotland. They are helpful different firms to handle their financial
accounts related to VAT, Payroll and many more services.
Partnership: As the name suggest, a partnership firm is a business for most managing
firm which is owned by the two or more people. Partnership firm has the advantage for working
flow through the use of taxation. Owners are the one who is responsible for liability of the firm.
For example, Mumsnet was founded by Carrie Longton and Justine Roberts. It is one of the
successful organisation in UK which is largely operated into the business organisation.
Companies: These are the companies which are useful for make more effective approach
to manage the separate legal entity which is created by their stakeholders. AT the time of
incorporating the business owners are able to manage the time and work with the company's debt
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and legal disputes (Putra and et.al., 2021). This will be helpful for generalising the article and
provide different information to provide number of sales and major purpose of the locations. For
example, Marks and Spencer, is the company which is included in the type of UK based retail
industry. The employees of the company are totally independent from the company and they are
not liable for any type of liability for the company in market.
Distinguish between the two forms of share capital and two forms of long term debt in the
context of long term sources of finance of listed public limited companies.
Share capital refers to the funds which a company receive and sell the ownership to the
public company. Most of the companies are able to work and manage the task and activities to
expand their size of investors and investment amount into the market. Mainly there are two type
of shares which are explained below:
Basis Equity share Preferences share
Meaning They are the ordinary shares of
the company and mainly
represent the part of ownership
of the shareholders.
These are the shares that carry
the preferential rights on the
matters of payment to make
high capital.
Payment of dividend Dividend is paid after the
payment of all liabilities.
Priority in payment over the
equity shareholders.
Convertibility These shares can never be
converted (Li, Huang and Li,
2021).
These shares can be converted
into equity shares.
Example Marks and Spencer have their
own equity shares in the
market which are related to
make growth to work in
different capturing share.
Tesco has large number of
preferences shares which show
that the company has high
market demand into the retail
industry.
Long terms debt refers to pay nay financial obligation which is helpful for complete their
work and make extended market growth for more than 12 months (Kusi and et.al., 2021). There
are different type of bonds which are helpful for making bonds, mortgage payable, pension
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liabilities and many more. That are helpful for generalising the statement and reported as
different long term debt and management perspective for the future growth.
Basis Debenture Corporate Bonds
Meaning This is basically related to
make unsecured bond that is
useful for make effective
corporations.
They have the higher amount
of risk than other type of long
term debts that can be used by
the market and companies.
Growth and risk It is used for the growth and
publicity of the company as it
is one of the important
investment for raising the
funding amount (Siegel,
2021).
They are mainly depend on the
solvency of the company as it
has more risk than any other
investors.
Examples Marks & Spencer use the
debenture for long term fund
ariser within the company and
make systematic growth into
the market and achieve more
profit.
Tesco is using corporate bond
for rising their investment and
make growth in the market to
raise their financial conditions
(Baines and Hager, 2021).
Conclusion
From the above report, it is analysed that most of the business are highly depend on the
three major investors and make systematic growth in the market as per their own need and
shareholders. Furthermore, it is determined that the company is using major financial records
that help the company to grow into the market. This can be accomplish by using the share and
long term debt funds within the market. These will be helpful for most challenging and helpful
record to work and make systematic growth to manage financial reporting by the use of different
issuers and investing decision into the market.
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References
Books & Journals
Blount, I.Y., 2021. How do large purchasing organizations treat their diverse suppliers? Minority
business enterprise CEOs’ perception of corporate commitment to supplier diversity.
Business & Society, 60(7), pp.1708-1737.
Capiña, M.V., 2021. Impact of Management Practices on Micro and Small Enterprise (MSEs)
Performance in Marinduque, Philippines. Journal of Social Entrepreneurship Theory
and Practice, 1(1), pp.84-97.
Putra, F.I.F.S., Budiantoro, R.A. and Haziroh, A.L., 2021. Implementation of Digital Marketing
for Economic Recovery of Micro Small Enterprise after Covid-19.
Li, J., Huang, Z. and Li, Y., 2021, August. Exploration on the Practical Teaching Environment
of Enterprise Supply Chain Logistics Training. In 2021 16th International Conference
on Computer Science & Education (ICCSE) (pp. 978-982). IEEE.
Kusi, B.A., Dzeha, G., Gyan, K.K. and Turkson, F.E., 2021. Debt capital structure and credit
information sharing: Evidence on listed firms from an emerging market. Journal of
African Business, 22(2), pp.153-170.
Siegel, J.J., 2021. Stocks for the long run: The definitive guide to financial market returns &
long-term investment strategies. McGraw-Hill Education.
Baines, J. and Hager, S.B., 2021. The great debt divergence and its implications for the Covid-
19 crisis: Mapping corporate leverage as power. New Political Economy, 26(5), pp.885-
901.
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