BUSINESS ADMINISTRATION
BUSINESS ENVIRONMENT
|
Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
|
|
|
Shareholders are the owners of a company whereas debtholders own debt issued by a company.
|
|
|
Shareholders are not different from debtholders as both hold stakes in a company.
|
|
|
Shareholders provide money when starting a company whereas debtholders supply funds during its course of business.
|
|
|
Shareholders have less rights than debtholders who have the actual control over a company.
|
Detailed explanation-1: -Shareholders are owners of the company whereas debtholders are lenders to the company. A debtholder is one who receives the same payment no matter how well an organization does. Debtholders are often an organizations bankers or bondholders. Shareholders are individuals who own shares in the organization.
Detailed explanation-2: -Unlike the owners of sole proprietorships or partnerships, corporate shareholders are not personally liable for the company’s debts and other financial obligations. Therefore, if a company becomes insolvent, its creditors cannot target a shareholder’s personal assets.
Detailed explanation-3: -Equityholders are normally giv bring derivative suits against managers, but debtholder holders are given no protection unless they put provisi contract, ” whereas equityholders are given many prote rate law even if they are silent in their contracting an protections are, as discussed below, mandatory and cann out.
Detailed explanation-4: -A shareholder becomes a member once his name is entered into the company’s register of members or if he is a subscriber to the constitution of the company. A member of a company limited by guarantee is not a shareholder because there is no share capital in the company.