IEO Level 2- English Olympiad (SOF) Class 9 Coaching Programs
β³ π― Online Tests (2 Tests [50 Questions Each]): NTA Pattern, Analytics & Explanations
Click Here to View & Get Complete Material
Rs. 200.00
3 Year Validity (Multiple Devices)
π Study Material (303 Notes): 2024-2025 Syllabus
Click Here to View & Get Complete Material
Rs. 450.00
3 Year Validity (Multiple Devices)
π― 250 MCQs (& PYQs) with Full Explanations (2024-2025 Exam)
Click Here to View & Get Complete Material
Rs. 200.00
3 Year Validity (Multiple Devices)
Company Form of Business Organisation: Advantages and Disadvantages of Joint Stock Company
Advantages and Disadvantages of Joint Stock Company
Choosing the Right Form of Organization
- Ease of formation: Sole trader can commence and withdraw from business at any time at his own option.
- Availability of Large Resources: Only a company can raise enough capital and hire expert knowledge required for the management of a big business.
- Liability or Risk: Members be uncertain to undertake big risk they prefer to invest in a company.
- Stability: The existence of a company and cooperative society does not depend on the health and wealth of its members.
- Flexibility: An ideal form of business must have flexibility in operations.
- Secrecy: Company is required to file a number of documents and publish its annual reports. Therefore, secrecy is the least in case of a company.
- Extent of state control: Company has to fulfill many legal formalities before it can commence its business.
Suitability of Joint Stock Company
A joint stock company is suitable where
- Volume of business is large
- Area of operation is widespread
- Risk involved is high
- Need for huge financial resources and manpower
- Need for professional management in its operations
- Preference for operating on large scale
Summary and Comparisons of Different Characteristics of Sole Proprietorship, Partnership and Company
Characteristics | Most advantageous form | Least advantageous form |
---|---|---|
Availability of finances | Company | Sole proprietorship |
Cost of organizing and dissolving. | Sole proprietorship | Company |
Ease of organizing and dissolving. | Sole proprietorship | Company |
Ease of transferring or withdrawing ownership | Company | Partnership |
Efficiency in management. | Company | Sole Proprietorship |
Freedom to operate in any state. | Sole proprietorship | Company |
Government control and restriction | Sole proprietorship | Company |
Length of life | Company | Sole Proprietorship |
Simplicity of operations | Sole proprietorship | Company |