A private company is generally prohibited from:
Correct answer: B. Inviting the general public to subscribe for its shares
- A. Issuing shares to its members
- B. Inviting the general public to subscribe for its shares
- C. Maintaining a separate bank account
- D. Appointing directors to manage its affairs
Explanation
A private company raises capital privately and cannot make a general invitation to the public to subscribe for its shares. It may still issue shares to permitted members and operate through directors.
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About Nature and Forms of Business Organisation
Business organisation combines people, capital, materials and entrepreneurship to produce goods or services and earn profit, while also meeting customer and social needs. Coverage includes sole proprietorships, partnerships, companies and cooperatives, with comparisons of ownership, liability, control, profit sharing, continuity and legal status.
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