Question

10 Reasons a joint stock company is preferable to a one man's business

Answer 1

Answer:

A joint-stock company is a business entity in which shares of the company's stock can be bought and sold by shareholders. Each shareholder owns company stock in proportion, evidenced by their shares (certificates of ownership).[1] Shareholders are able to transfer their shares to others without any effects to the continued existence of the company.[2]

In modern-day corporate law, the existence of a joint-stock company is often synonymous with incorporation (possession of legal personality separate from shareholders) and limited liability (shareholders are liable for the company's debts only to the value of the money they have invested in the company). Therefore, joint-stock companies are commonly known as corporations or limited companies.

Answer 2

Reasons a joint stock company is preferable to a one man's business

Explanation:

1. Joint stock company are best fitted for for starting large size business whereas sole trader business is small.
2. Joint stock company ensures long life whereas in sole trading business when sole trader dies business cannot exist.
3. There will be limited capital in one man's business and in joint stock company there will be large capital.
4. There are managers to take decisions but in one man should take decisions on his own in  one man's business.
5. There is lack of specialisation in sole trader but in joint stock company there are experts.
6. There is professionalisation of management in company.
7. The production is done in large scale basis but not in one man's business.
8. Companies enjoy better credit facility unlike one man's business.
9. The  one man's business is unstable but company is stable.
10. There is risk of entire loss one man's business unlike company.

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10 Reasons a joint stock company is preferable to a one man's business

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