DEPARTMENT OF TECHNICAL EDUCATION

ANDHRA PRADESH
Name : S. VENKATESWARA RAO
Designation : HEAD OF SECTION
Branch : D.C.C.P.
Institute : GPW, NANDIGAMA
Year : I year
Subject : Business Organization
Subject code : CCP-104
Topic : Forms of Business Organization,
Duration : 50 mts
Sub topic : MERITS OF JOINT STOCK COMPANY
Teaching Aids: : P.P.T.

CCP104.27 1
Objectives
On completion of this period you would be
able to know:
 The merits of joint stock company

CCP104.27 2
Recap
Definition of joint stock company
Features of a joint sock company
Need for a joint stock company

CCP104.27 3
Merits:
 Limited Liability
 Perpetual (Continuous) Existence
 Huge Financial Resources
 Unlimited number of Share Holders
 Large Capital divided into small units

called Shares

CCP104.27 4
 Contd…

Merits:
 Transferability of Shares
 Risk-Bearing capacity - diffusion of risk
 Efficient Management
 Employment of Expert services
 Large scale Operations

CCP104.27 5
 Contd…

Merits:
 Public Confidence
 Democratic Control
 Scope for Expansion
 Social Advantages
 Better Employment Opportunities
 Industrial Development

CCP104.27 6
Summary
 Lot of advantages for Joint stock
Company, superior to sole trader and
partnership concerns

CCP104.27 7
Quiz:
1. Large capital is possible in a joint stock company
because___________________.
More number of owners

3. A joint stock company survives for longer period

because__________________________.
Management and ownership different

CCP104.27 8
Frequently Asked Questions
1. List any six advantages of a joint stock
company
2. Explain the merits of a joint stock company

CCP104.27 9