14/10/2014
Business: Any legal activity which is undertaken for the purpose of earning of profit.
Types of Business:
Manufacturing: In this type of business the process to setup the products forms transformation of raw material to our desire products.
Trading: This type of business buys products at wholesale price and sells the same at retail price. They are known as "buy and sell" businesses. They make profit by selling the products at prices higher than their purchase costs.
Services: A service type of business provides intangible products (products with no physical form). Service type firms offer professional skills, ability, advice, and other similar products.
Modes of Business / Method of Business:
Sole Proprietorship: A sole proprietorship is a business owned by only one person. It is easy to set-up and is the least costly among all forms of ownership.
Partnership: A partnership is a business owned by two or more persons who contribute resources into the entity. The partners divide the profits of the business among themselves. That is under the act of 1932
Joint stock Company: When a large group of people that works together to form a corporation that operate a business at high level. This type of company issues stock and allows for secondary market trading; however, stockholders are liable for company debts.
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