1.5.4 Forms of ownership-LTD/PLC Flashcards

1
Q

What is a Private limited company?

A

Where a business cannot out stocks on stock market and stocks are invitational only.

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2
Q

What is a Public limited company?

A

When a businesses stocks can be on the stock market, people contribute funds in return for shares.

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3
Q

What are 3 Characteristics of a PLC?

A

Limited liability
Sell shares in stock market
Process of floatation is expensive

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4
Q

What are 3 characteristics of a LTD?

A

Must have 1 or more shareholders
Limited liability
Accounts have to be logged with registrar companies

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5
Q

Name two advantages of a LTD

A

1)More flexible than PLC
2)Owners can remain in control of company if don’t sell too many shares

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6
Q

Name two disadvantages for a LTD

A

1)Shares can’t be sold to public
2)Expensive to set up

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7
Q

Name two advantages of a PLC

A

1)Easier to raise finance from stock market
2)More stable and secure types of business»> less risk

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8
Q

Name two disadvantages of a PLC

A

1)Possibility of takeover
2)Annual accounts have to be published

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