Explain any five reasons why a joint stock company is preferable to a one-man business.
Explanation
Reasons why Joint stock is preferable to .a one - man business are:
(i) A company is a legal entity - It can sue and be sued
(ii) It enjoys limited liability.
(iii) There is continuity of existence in spite of death of owners.
(iv) There is separation of ownership from management.
(v) It enjoys economy of large scale production.
(vi) Shares are easily transferable without affecting the company.
(vii) Ability to attract large financial resources from various sources e.g. bank loan, debenture, sales of share etc.
(viii) It has the opportunity of bringing expertise into business.