CBSE Class 11 Business Studies – MCQ and Online Tests – Unit 7 – Formation of a Company
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CBSE Class 11 Business Studies – MCQ and Online Tests – Unit 7 – Formation of a Company
Question 1.
Minimum number of members required to apply for incorporation certificate in a public ltd company is
(a) 3
(b) 2
(c) 7
(d) 50
Answer
Answer: (c) 7
Question 2.
Preliminary Contracts are signed
(a) Before the incorporation
(b) After incorporation but before capital subscription
(c) After incorporation but before commencement of business
(d) After commencement of business
Answer
Answer: (a) Before the incorporation
Question 3.
A prospectus is issued by
(a) A private company
(b) A public company seeking investment from public
(c) A public enterprise
(d) A public company
Answer
Answer: (b) A public company seeking investment from public
Question 4.
The company needs to obtain prior permision from central government when it changes the address of its registered office from
(a) one city to another city
(b) with in the same city
(c) one state to another
(d) one country to another country
Answer
Answer: (c) one state to another
Question 5.
A person cannot hold directorship in more than ____ public companies
(a) 3
(b) 10
(c) 20
(d) 7
Answer
Answer: (c) 20
Question 6.
Powers, rights, remuneration, qualification and duties of directors are discussed clearly in
(a) Memorandum of Association
(b) Articles of Association
(c) Prospectus
(d) none of the above
Answer
Answer: (b) Articles of Association
Question 7.
__________ means the total amount of called up capital on the shares issued and subscribed by the shareholders on capital account.
(a) Called-up capital
(b) subscribed capital
(c) nominal capital
(d) Paid-up capital
Answer
Answer: (a) Called-up capital
Question 8.
_____________ share capital has priority both in repayment of dividend as well as capital.
(a) Equity
(b) non preference
(c) Preference
(d) all of the above
Answer
Answer: (c) Preference
Question 9.
Par value of shares means the __________ value of the shares
(a) Actual
(b) face
(c) Market
(d) dividend
Answer
Answer: (b) face
Question 10.
The Prospectus must be issued to the public within ______________ days of its date
(a) 30
(b) 60
(c) 90
(d) 100
Answer
Answer: (c) 90
Question 11.
A copy of the ________________ must accompany each from of application for shares offered to the public.
(a) Memorandum of association
(b) Prospectus
(c) Articles of association
(d) None of the above
Answer
Answer: (b) Prospectus
Question 12.
___________ cannot give invitation to the public to subscribe for any shares in or debentures of the company
(a) Subsidiary company
(b) Statutory Company
(c) Private company
(d) Registered company
Answer
Answer: (c) Private company
Question 13.
A private company means a company which has a minimum paid up capital of Rs.————-
(a) 1,00,000
(b) 5,00,000
(c) 50,00,000
(d) none of the above
Answer
Answer: (a) 1,00,000
Question 14.
The shares of a _______________ company can be freely transferable
(a) Private ltd
(b) Public ltd
(c) Partnership
(d) all of the above
Answer
Answer: (b) Public ltd
Question 15.
“Men may come and men may go but the company exist”- this explains which characteristics of the company as per companies Act 1956
(a) Separate legal entity
(b) Perpetual Succession
(c) Capacity to sue
(d) None of the above
Answer
Answer: (b) Perpetual Succession
Question 16.
Which of the following clause of Memorandum of Association cannot be altered
(a) Name
(b) Object
(c) situation
(d) liability
Answer
Answer: (d) liability
Question 17.
Which of the following is not a clause of memorandum of association
(a) situation
(b) capital
(c) subscription
(d) directors
Answer
Answer: (d) directors
Question 18.
The company will be considered as separate person and different from its members from the date (when the) _____________
(a) start of business
(b) Apply for registration
(c) receive incorporation certificate
(d) mentioned in certificate
Answer
Answer: (d) mentioned in certificate
Question 19.
The certificate of capital will be issued by
(a) Registrar of companies Act
(b) Controller of companies Act.
(c) Registrar of capital issues
(d) controller of capital issues
Answer
Answer: (d) controller of capital issues
Question 20.
Preliminary Contracts are
(a) binding on the Company
(b) binding on the Company, if ratified after incorporation
(c) binding on the Company, after incorporation
(d) not binding on the Company
Answer
Answer: (d) Not binding on the Company
Question 21.
Stages in the formation of a public company are in the following order
(a) Promotion, Commencement of Business, Incorporation, Capital Subscription
(b) Incorporation, Capital Subscription. Commencement of Business, Promotion
(c) Promotion, Incorporation, Capital Subscription, Commencement of Business
(d) Capital Subscription, Promotion, Incorporation, Commencement of Business
Answer
Answer: (c) Promotion, Incorporation, Capital Subscription, Commencement of Business
Question 22.
A proposed name of Company is considered undesirable if
(a) It is identical with the name of an existing company
(b) It resembles closely with the name of an existing company
(c) It is an emblem of Government of India, United Nations etc.
(d) In case of any of the above
Answer
Answer: (d) In case of any of the above
Question 23.
Minimum number of members to form a public company is
(a) 5
(b) 7
(c) 12
(d) 21
Answer
Answer: (b) 7
Question 24.
The articles of association needs to be signed by
(a) all proposed directors
(b) registrar
(c) subscribers of memorandum
(d) none of the above
Answer
Answer: (c) subscribers of memorandum
Question 25.
If the proposed nominal capital is more than 25 lakh at the time of incorporation then the company needs to submit ________________ along with the application
(a) statement of capital
(b) certificate of incorporation
(c) certificate of capital
(d) certificate of incorporation
Answer
Answer: (c) certificate of capital
Question 26.
Among the following which documents are not mandatory to be submitted to the registrar along with incorporation application by a private company.
(a) Address of Registered office & undertaking
(b) Undertaking and statement of capital
(c) statement of capital & list of directors
(d) list of directors and statement of capital
Answer
Answer: (a) Address of Registered office & undertaking
Question 27.
Application for approval of name of a company is to be made to
(a) SEBI
(b) Registrar of Companies
(c) Government of India
(d) Government of the State in which Company is to be registered
Answer
Answer: (b) Registrar of Companies
Question 28.
Minimum number of members to form a private company is
(a) 2
(b) 3
(c) 5
(d) 7
Answer
Answer: (a) 2
Question 29.
Private company prohibits any invitation or acceptance of deposits from persons other than its ___________
(a) Members
(b) directors
(c) Partners
(d) banks
Answer
Answer: (a) Members
Question 30.
A company is known as the _______company of another company if it has control over that other company.
(a) subsidiary
(b) holding
(c) controlling
(d) statutory
Answer
Answer: (b) holding
Question 31.
For example Par value is Rs10 and it is issued at Rs15 then Rs5 is the ___________ amount
(a) Profit
(b) Market value
(c) dividend
(d) premium
Answer
Answer: (d) premium
Question 32.
__________ means the total amount of called up share capital which is actually paid to the company by the members
(a) nominal capital
(b) reserve capital
(c) called up capital
(d) Paid-up capital
Answer
Answer: (d) Paid-up capital
Question 33.
The dividend payable to ___________ share holders is payable on fixed figure or percent
(a) Equity
(b) non preference
(c) Preference
(d) all of the above
Answer
Answer: (c) Preference
Question 34.
_______________ capital means the sum mentioned in the capital clause of Memorandum of Association
(a) Full capital
(b) Maximum capital
(c) share capital
(d) Nominal Capital
Answer
Answer: (d) Nominal Capital
Question 35.
If the company can make arrangements for raising the capital privately so that pubic appeal is unnecessary, the company is required to prepare a _________________
(a) Prospectus
(b) statement in lieu of Prospectus
(c) certificate of Prospectus
(d) none of the above
Answer
Answer: (b) statement in lieu of Prospectus
Question 36.
A Government Company means any company in which not less than 51% of the paid-up share capital is held by
(a) Central Government
(b) State government
(c) Both a & b
(d) Neither a nor b
Answer
Answer: (c) Both a & b
Question 37.
A private company means a company which has a minimum paid up capital of Rs.————-
(a) 1,00,000
(b) 5,00,000
(c) 50,00,000
(d) none of the above
Answer
Answer: (b) 5,00,000
Question 38.
_________ are the company created by special act of the legislature
(a) Registered company
(b) Public Ltd Company
(c) Private ltd company
(d) Statutory company
Answer
Answer: (d) Statutory company
Question 39.
The liability of the members of the company can be limited by
(a) Share
(b) Guarantee
(c) Both a & b
(d) Neither a nor b
Answer
Answer: (c) Both a & b
Question 40.
When the registered office of a company is changed within a city then it has to be intimated to the registrar within ________ days of such change
(a) 60
(b) 45
(c) 30
(d) 7
Answer
Answer: (c) 30
Question 41.
If a company is instructed to change its name which resembles the name of an existing company then the company can change the name by
(a) Passing a special resolution
(b) obtaining permission from central government
(c) Passing an ordinary resolution
(d) Both a & b
Answer
Answer: (c) Passing an ordinary resolution
Question 42.
Number of clauses in Memorandum of Association is
(a) 5
(b) 6
(c) 7
(d) 8
Answer
Answer: (b) 6
Question 43.
A statement of nominal capital must be given at the time of incorporation by the company when the share capital is less than
(a) 50 Lakh
(b) 1 crore
(c) 10 Lakh
(d) 25 Lakh
Answer
Answer: (d) 25 Lakh
Question 44.
The address of the registered office of the company must be notified to the registrar within _________ days of registration, if it is not done at the time of incorporation
(a) 15
(b) 30
(c) 60
(d) 45
Answer
Answer: (b) 30
Question 45.
The application for registration of a company should be presented to the _______________ of the state appointed under Companies Act 1956
(a) Controller
(b) registrar
(c) Governor
(d) registration officer
Answer
Answer: (b) registrar
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