5 Lecture

1. What is the legal status of a joint stock company? a) A partnership b) A sole proprietorship c) A separate legal entity d) A government entity

Answer: c) A separate legal entity

2. Who manages the affairs of a joint stock company? a) Shareholders b) Board of Directors c) Partners d) CEO

Answer: b) Board of Directors

3. What is the liability of shareholders in a joint stock company? a) Limited to their investment in the company b) Unlimited c) Limited to the amount of the company's profits d) Limited to the amount of the company's debts

Answer: a) Limited to their investment in the company

4. What is the minimum number of shareholders required to form a joint stock company? a) 1 b) 2 c) 3 d) 4

Answer: b) 2

5. How are the profits and losses of a joint stock company distributed among shareholders? a) Based on the number of shares owned by each shareholder b) Equally among all shareholders c) According to the seniority of the shareholders d) According to the age of the shareholders

Answer: a) Based on the number of shares owned by each shareholder

6. What is the maximum number of shareholders allowed in a private joint stock company? a) 10 b) 50 c) 100 d) 200

Answer: b) 50

7. What is the minimum amount of capital required to form a joint stock company? a) There is no minimum requirement b) $10,000 c) $50,000 d) $100,000

Answer: a) There is no minimum requirement

8. What is the process of selling shares in a joint stock company to the public? a) IPO (Initial Public Offering) b) A private placement c) A merger d) An acquisition

Answer: a) IPO (Initial Public Offering)

9. What is the term used for the transfer of shares from one shareholder to another in a joint stock company? a) Sale b) Purchase c) Transfer d) Assignment

Answer: c) Transfer

10. What is the role of the auditor in a joint stock company? a) To manage the affairs of the company b) To audit the financial statements of the company c) To sell shares to the public d) To issue dividends to the shareholders

Answer: b) To audit the financial statements of the company

1. What is a joint stock company? Answer: A joint stock company is a type of business organization in which the capital is divided into shares and held by shareholders. It is a legal entity separate from its owners and is managed by a board of directors.

2. What is the minimum number of shareholders required to form a joint stock company? Answer: The minimum number of shareholders required to form a joint stock company is two.

3. What is the liability of shareholders in a joint stock company? Answer: The liability of shareholders in a joint stock company is limited to the amount of their investment in the company.

4. What is the role of the board of directors in a joint stock company? Answer: The board of directors manages the affairs of the joint stock company.

5. What is an IPO? Answer: IPO stands for Initial Public Offering, which is the process of selling shares in a joint stock company to the public for the first time.

6. What is the maximum number of shareholders allowed in a private joint stock company? Answer: The maximum number of shareholders allowed in a private joint stock company is 50.

7. What is the process of transferring shares in a joint stock company? Answer: The process of transferring shares in a joint stock company is called share transfer.

8. What is the role of auditors in a joint stock company? Answer: The role of auditors in a joint stock company is to audit the financial statements of the company.

9. What is the difference between a private and a public joint stock company? Answer: A private joint stock company has a maximum of 50 shareholders and cannot sell shares to the public, while a public joint stock company can have an unlimited number of shareholders and can sell shares to the public.

10. What is the minimum amount of capital required to form a joint stock company? Answer: There is no minimum amount of capital required to form a joint stock company.

A joint stock company, also known as a corporation, is a type of business organization in which the capital is divided into shares that can be traded on the stock market. This type of company allows multiple investors to pool their resources and share in the profits and losses of the business. One of the main benefits of a joint stock company is that the liability of the shareholders is limited to the amount of their investment in the company. This means that their personal assets are protected in case the company runs into financial trouble or goes bankrupt. The management of a joint stock company is typically entrusted to a board of directors, who are elected by the shareholders. The board is responsible for making strategic decisions, appointing senior executives, and ensuring that the company is managed in the best interests of the shareholders. To raise capital, a joint stock company can issue shares to the public through an initial public offering (IPO) or by selling shares to institutional investors or private individuals. The price of the shares is determined by the supply and demand in the market, and can fluctuate depending on various factors, such as the performance of the company, economic conditions, and investor sentiment. There are two types of joint stock companies: private and public. A private joint stock company has a maximum of 50 shareholders and cannot sell shares to the public. A public joint stock company, on the other hand, can have an unlimited number of shareholders and can sell shares to the public. One of the key features of a joint stock company is the ease with which ownership can be transferred. Shareholders can sell their shares on the stock market or through a private transaction. This means that ownership of the company can change hands without affecting the operation of the business. To ensure transparency and accountability, joint stock companies are required to prepare and publish audited financial statements. These statements are subject to review by independent auditors, who are appointed by the shareholders. The purpose of the audit is to provide assurance that the financial statements are accurate and comply with the relevant accounting standards.