Joint Stock Company — Chapter Summary
ICSE · Class 11 · Commerce
Summary of Joint Stock Company for ICSE Class 11 Commerce. Key concepts: A company is an association, L and A company is not a natural.
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Overview
A joint stock company is a form of business organisation created to overcome the weakness of partnership, especially shortage of capital, unlimited liability, lack of stability, and weak managerial ability. Its capital is divided into shares of small value, so both rich and poor people can invest. I
Key Concepts
A company is an association
A company is an association of persons formed for a common objective. Its capital is divided into shares, members usually have limited liability, and
L
L.H. Haney defined a company as an artificial person created by law with separate entity, perpetual succession, and a common seal. James Stephenson, L
A company is not a natural
A company is not a natural person, but the law treats it as a person. It can own property, sue and be sued, and carry on business in its own name.
A company has a legal identity
A company has a legal identity different from its shareholders. The company and its members are not the same person in law.
The life of a company does
The life of a company does not end with the death, retirement, or transfer of shares of its members. The idea is expressed by the saying: Members may
Learning Objectives
- To understand the meaning and definitions of a joint stock company
- To study the essential characteristics of a company
- To compare partnership and joint stock company
- To understand the merits and demerits of a joint stock company
- To learn the objectives of forming a joint stock company
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Sources & Official References
Content is aligned to the official syllabus. Refer to the board website for the latest curriculum.
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