Advantages and privileges of public limited company
1.Adequate capital :
1.Adequate capital :
comparatively , capital investment in company is more than partnership
firm and sole trading concern. The company can collect capital by issuing
shares or debentures among unlimited peoples for subscription. With large
capital , it can operate large scale business. The large scale production and
distribution minimizes per unit cost or services.
2.Limited
liability:
The liability of shareholders of
the company is limited up to their capital investment .The company can borrow
loan for expansion and diversification of business or purchase good on credit
during regular business , but in its own name.
3.Perpetual
existence :
company is an artificial person created by law. As a corporate body its
existence is perpetual. The death, retirement, lunacy of shareholders or
promoters do not affect in regular function of the
company. Similarly , it performs function without any interruption even
if any change in management , member of board of directors , working procedure
etc.
4.Transferability
of shares :
shares of joint stock company, especially shares of public limited
company are easily transferable from one person to another . such transfer of
shares does not affect the regular function of the company and prior permission
from management is not required.
5.Effective
management :
Management is the back bone of an institution and success of it depends
upon its management system. In company for the function of management, members
of board of directors elected. They are the representatives of the shareholders
and responsible for management of the company.
6.Easy
to obtain loan :
for the expansion of the business
,the company can obtain loan in easy manner. It performs business in large
scale with the investment of maximum capital and, as perpetual existence; it
also performs business for long duration of time
7.Accountilibity:
8.social
value :
company performs activities which are directly or indirectly beneficial
to the society . it provides employment opportunities to skilled or unskilled
people according to their ability.
9.Based
on democratic management :
