The Advantages of a Company Over a Partnership and Sole

question 29

Multiple Choice

The advantages of a company over a partnership and sole trader do not include which of the following?

• A) Members are able to sell their shares at any time to another person without having to obtain permission from the other members.
• B) Members are liable for only a limited amount of the company's debts.
• C) A company has a legal existence distinct from its owners.
• D) A company is only entitled to raise small amounts of cash by issuing shares.

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Definitions:

Negligence

A failure to exercise the care that a reasonably prudent person would exercise in similar circumstances.

Reasonable Standard Of Care

The degree of caution and concern an ordinarily prudent and rational person would use in similar circumstances.

Societal Need

Essential requirements that are necessary for the well-being and functioning of society as a whole.

Expectations

Expectations refer to the beliefs or forecasts about future events or outcomes, often based on past experiences or evidence.