BUSINESS ADMINISTRATION
FINANCIAL ACCOUNTING
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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Public
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Private
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One person company
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None of these
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Detailed explanation-1: -Shares of a company registered in India can be issued to the general public (with SEBI approval) by a Limited Company or can be issued to persons and entities comprising of friends, relatives, business partners, etc., in case of a private limited company.
Detailed explanation-2: -Private companies may issue stock and have shareholders, but their shares do not trade on public exchanges and are not issued through an initial public offering (IPO). As a result, private firms do not need to meet the Securities and Exchange Commission’s (SEC) strict filing requirements for public companies.
Detailed explanation-3: -A private limited company is also a separate legal entity and has its own rights. It has a complex structure and you can easily issue shares in a limited company, which is not possible in a sole proprietorship or partnership.