LO1: limited companies

Question 1

what is limited company?

Answer 1

Incorporated companies that require one of two forms to be filled out: the articles of associations or the memorandum of association

Question 2

what is the article of association?

Answer 2

the ‘rule book’ that will outline:
-the directions and their roles
- rules of shareholder meetings
-voting rights of shareholders
-how account will be recorded

Question 3

what is memorandum of assocation?

Answer 3

gives of information of:
-company name and address
- business activity
-statement of limited liability
-number of shares to be sold

Question 4

what are the two types of limited companies?

Answer 4

-by guarantee
-by shares

Question 5

4 factors of guarantee companies?

Answer 5

-members give a guarantee to pay an agreed sum should the business be wound up
-this is limited liability
-the business is run by a board of directors
directors are elected by members

Question 6

3 factors of shares companies?

Answer 6

-members own one + shares
-amount invested in shares is the limit of liability
-business is run by a board of directors