问答题

In relation to winding up of a company under company law: (b) distinguish between a members’ voluntary winding up and a creditors’ voluntary winding up; (4 marks)

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(c) explain how and when a company may declare dividends. (5 marks)

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Ann started baking cakes in her kitchen as a hobby after she was made redundant two years ago. Her hobby soon became a business when friends and relatives started ordering cakes from her. Over that period, the orders per month have been increasing steadily. The demand is so high that she is seriously considering registering her business and several supermarkets have suggested they will place large orders with her if she could guarantee delivery every day. Ann’s friend, Cindy, wants to join her in running the business but has told her they must form a registered company if they are to expand their operations. Ann is worried about her potential personal liability if she were to be part of this business.Required:Advise Ann on whether a partnership, limited liability partnership, or company is a suitable form of business, specifically in relation to her concerns about personal liability. (10 marks)

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