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Which of the following is the difference between sole traders and limited liability companies?
A. A sole trader’s financial statements are private and never made available to third parties; a company’s financial statements are given to shareholders and may be publicly filed.
B. Both businesses have share capital.
C. Only drawings appear in a sole trader’s financial statements.
D. A sole trader is fully and personally liable for any losses that the business might make, while a company’s losses are borne by the government.
E. Both the sole trader and companies issue loan notes in order to raise funds.
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The nature and structure of business entities determine largely their accounting systems and processes.
On the basis of the above, you are required to explain seven advantages of a limited liability company over a sole proprietorship business.
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Find Related Questions by Tags, levels, etc.
Find Related Questions by Tags, levels, etc.
Find Related Questions by Tags, levels, etc.
Section 9 of the Companies Act, 1963 (Act 179) provides that a company limited by shares is “a company having the liability of its members limited to the amount, if any, unpaid on the shares respectively held by them”.
Required:
State and explain TWO (2) advantages that exist for a company limited by shares. (2 marks)
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Find Related Questions by Tags, levels, etc.
Which of the following is the difference between sole traders and limited liability companies?
A. A sole trader’s financial statements are private and never made available to third parties; a company’s financial statements are given to shareholders and may be publicly filed.
B. Both businesses have share capital.
C. Only drawings appear in a sole trader’s financial statements.
D. A sole trader is fully and personally liable for any losses that the business might make, while a company’s losses are borne by the government.
E. Both the sole trader and companies issue loan notes in order to raise funds.
Find Related Questions by Tags, levels, etc.
The nature and structure of business entities determine largely their accounting systems and processes.
On the basis of the above, you are required to explain seven advantages of a limited liability company over a sole proprietorship business.
Find Related Questions by Tags, levels, etc.
Find Related Questions by Tags, levels, etc.
Find Related Questions by Tags, levels, etc.
Find Related Questions by Tags, levels, etc.
Section 9 of the Companies Act, 1963 (Act 179) provides that a company limited by shares is “a company having the liability of its members limited to the amount, if any, unpaid on the shares respectively held by them”.
Required:
State and explain TWO (2) advantages that exist for a company limited by shares. (2 marks)
Find Related Questions by Tags, levels, etc.
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