Private and Public Limited Company Flashcards
1
Q
What type of liability do Public and Private Limited Companies have?
A
Private: Limited- If the business goes bankrupt the owner doesn’t lose everything. They’re separate entities.
Public: Limited
2
Q
How many owners are in a Private Limited Company?
A
Owner(s) and a maximum of fifty shareholders.
3
Q
How many owners are there in a Public Limited Company?
A
May be thousands.
4
Q
How do Ltd and Plc make money?
A
Shares and income.
5
Q
What are the advantages of Public Limited Companies?
A
- Shares can be sold to the public via stock exchange
- Increased capital
- Limited liability
6
Q
What are advantages of Private Limited Companies?
A
- Increased capital
- Limited liability
- Separate legal existence: Gives people who are owed money the right to sue the company without affecting the owner.
7
Q
What are the disadvantages of Private Limited Companies?
A
- Some financial information must be publicly available
- Shares aren’t available for wider sale
- Time consuming administration
8
Q
What are disadvantages of Public Limited Companies?
A
- Expensive to set up
- Owners can’t make their own choices
- Financial information must be public
- More risk of a hostile takeover through shares.
