Question

what are the needs and importance of a joint stock company

Answer 1

A joint-stock company is a business entity in which different numbers of 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] That allows for the unequal ownership of a business with some shareholders owning more of a company than others. Shareholders are able to transfer their shares to others without any effects to the continued existence of the company.

Advantages of joint-stock companies Edit

Ownership of stock refers to a large number of privileges. The company is managed on behalf of the shareholders by a board of directors, elected at an annual general meeting. The shareholders also vote to accept or reject an annual report and audited set of accounts. Individual shareholders can sometimes stand for directorships within the company if a vacancy occurs, but that is uncommon.

The shareholders are usually liable for any of the company debts that extend beyond the company's ability to pay. Meanwhile, the limit of their liability extends only to the face value of their shareholding. The concept of limited liability largely accounts for the success of this form of business organization.

Ordinary shares entitle the owner to a share in the company's net profit. It is calculated in the following way: the net profit is divided by the total number of owned shares, producing a notional value per share, known as a dividend. An individual's share of the profit is thus the dividend multiplied by the number of shares owned.

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Answer 2

A joint-stock company is a commercial enterprise in which divisions of the company's assets can be purchased and sold by stockholders. Each stockholder owns corporation stock in proportion, evidenced by their divisions such as documents of ownership.

Importance of the joint stock company;

Incorporated association:

An organization is described as an incorporated association because it comes into occurrence only after certification.

Minimum Number of Members:

Developing a public corporation at least 7 persons and for establishing a private company at least 2 persons are needed. If not recorded it would be interpreted as an illegal organization.

3. Artificial legal person:

A company is a formulation of authority and is described as an artificial person. It subsists only in the anticipation of law, and therefore, has no visible form.