A similarity of private and public company is that they
COMMERCE
WAEC 2023
A similarity of private and public company is that they
- A. sell shares on the stock exchange
- B. have equal number of members
- C. receive certificate of incorporation
- D. are required to publish their final accounts
Correct Answer: C. receive certificate of incorporation
Explanation
They both raise capital through the sales of share, they both require more than one person to start, they are controlled by a board of directors and they have separate legal status. A certificate of incorporation is a legal document issued by the government or relevant authority that confirms the formation and registration of a company as a legal entity. Both private and public companies go through the process of obtaining a certificate of incorporation, which grants them the status of a legally recognized business entity.
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