Which document shows that a limited company has been legally formed and is a separate legal entity, allowing it to begin trading shares?

Prepare for the IB Business and Management SL Exam with flashcards and multiple-choice questions. Each question includes hints and explanations to boost your confidence and success.

Multiple Choice

Which document shows that a limited company has been legally formed and is a separate legal entity, allowing it to begin trading shares?

Explanation:
A limited company becomes a separate legal entity once it has been legally formed, and the official proof is the Certificate of Incorporation. This document, issued by the registrar, confirms the company’s formation and its distinct legal personality, which allows it to issue shares and start trading as a company. A Deed of Partnership is for partnerships, not limited companies. Articles of Association set how the company runs internally, not proof of formation. Not-for-profit Registration concerns charities or non-profit bodies. Therefore, the Certificate of Incorporation is the correct document.

A limited company becomes a separate legal entity once it has been legally formed, and the official proof is the Certificate of Incorporation. This document, issued by the registrar, confirms the company’s formation and its distinct legal personality, which allows it to issue shares and start trading as a company. A Deed of Partnership is for partnerships, not limited companies. Articles of Association set how the company runs internally, not proof of formation. Not-for-profit Registration concerns charities or non-profit bodies. Therefore, the Certificate of Incorporation is the correct document.

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