What type of business allows for shares of stock to be sold to investors?

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Study for the Texas Aandamp;M University (TAMU) ACCT229 Exam. Get exam-ready with flashcards, detailed explanations, and multiple choice questions. Enhance your understanding and boost your confidence!

A corporation is the type of business that allows for shares of stock to be sold to investors. This structure is specifically designed to raise capital by offering ownership interests in the form of shares. When individuals purchase these shares, they become shareholders and have a claim on the corporation's assets and earnings. Corporations can issue various classes of stock and can be publicly traded on stock exchanges, facilitating the buying and selling of shares among investors.

In contrast, a sole proprietorship is owned and operated by a single individual and does not have shares for sale, as the owner retains full control and responsibility for the business. A partnership involves two or more individuals who share ownership, but it also does not allow for the sale of shares in the same way a corporation does. Lastly, a Limited Liability Company (LLC) combines features of both corporations and partnerships, providing limited liability to its owners, but it does not issue stock; instead, ownership is typically represented by membership interests. This structure is more flexible but does not involve the same kind of trading in shares as a corporation.