Question

Manoj, Ankit and Nikhil are good friends and doing interior designing business at a small-scale. Their business is taking off in a big way. Now there is a need to change their small-scale-business into a large-scale-business. The trio needs more capital to invest, to hire more employees and for other expenses. Due to the growing need they decided to re-organise their form of business. Now they wanted to have an organisation in which members have a limited liability and minimum paid-up capital is Rupees one lakh.

The type of organisation the trio wanted to form is ______.

Options

• Partnership

• Public company

• Private company

• Sole proprietorship

Answer 1

The type of organisation the trio wanted to form is private company.

Explanation:

A private company offers limited liability to its members and requires a minimum paid-up capital of ₹1 lakh, making it the suitable form of organization for the trio's growing business needs.