With the use of cases and/or examples, explain FOUR (4) of the following terms as used in company law: Fixed chargesPreference sharesRegistration of chargesNo par valueCapital maintenance

Answered: With the use of cases and/or examples,…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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With the use of cases and/or examples, explain FOUR (4) of the following terms as used in company law:

Fixed charges
Preference shares
Registration of charges
No par value
Capital maintenance

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Step 1

INTRODUCTION

A company is a legitimate organization formed by a group of people to conduct and manage an industrial or commercial venture. Depending on the corporate legislation of its state, a firm may be set up in a variety of forms for taxation and financial responsibility considerations.

A business is an artificial legal entity with the ability to buy, sell, and enter into agreements in its own name as well as file legal claims against and also be sued by third party companies.

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