The Capital needed to start a Public Limited Company could come from 2 different places. By this I mean that some of the money comes from a loan from the bank, and the rest comes from shares sold to the public, via the stock market. For Example 28% of J Sainsbury plc’s Share Capital came from Lord Sainsbury. However £50,000 is needed to start a PLC.
Limited Liability means that you are only liable for the business and not any of your own belongings. By this I mean that if I were in debt of £60,000 I would have to lose my business because my capital of £50,000 is now all gone. For Example J Sainsbury plc have a Share capital of £18,441,000,000. However if you see your share prices falling you can always appoint a new director.
Dividend is paid out using the profits from a PLC. By this I mean that the profit is divided into percentages and is paid out to shareholders. So if there was £10,000 profit and I owned 20% shares then I would receive £2,000. For Example if J Sainsbury plc were in profit of £500,000 and I had 5% of shares then I would receive £25,000 dividend. However the lower the percentage of shares you have the lower your dividend is going to be.
The Board of Directors makes decisions in the PLC. By this I mean Shareholders elect a Board of Directors, their job is to run the business, to make profits go up and Share prices rocket. For Example J Sainsbury plc has 11 directors, all with different tasks; they are J Sainsbury plc’s Board of directors, and are the people that run the business. However if there is a decision that is made and is disliked by the Shareholders they at the next election the Board of Directors could be voted out.
