CBSE Class 11 Business Studies Formation of a Company MCQs

Question : Minimum number of members to form a public company is
(a) 5
(b) 7
(c) 12
(d) 21

Answer :  B

Question : The application for registration of a company should be presented to the _______________ of the state appointed under Companies Act 1956
(a) Controller
(b) Registration officer
(c) Governor
(d) Registrar 

Answer :  D

Question : “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 :  B

Question : 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 :  B

Question : 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 :  B

Question : 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 :  B

Question : 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 :  B

Question : 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 :  C

Question : 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 :  C

Question : Par value of shares means the __________ value of the shares
(a) Actual
(b) face
(c) Market
(d) dividend

Answer :  B

Question : 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 :  C

Question : 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 :  D

Question : _________ 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 :  D

Question : 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 :  B

Question : 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 :  D

Question : 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 :  D

Question : Statement in lieu of prospectus can be filed by
(a) Public company
(b) Private company
(c) Unregistered company
(d) None of the above

Answer :  A

Question : The articles of association need to be signed by
(a) All proposed directors
(b) Registrar
(c) Subscribers of memorandum
(d) None of the above

Answer :  C

Question : A private company means a company which has a minimum paid up capital of Rs.———
(a) 100,000
(b) 500,000
(c) 5,000,000
(d) none of the above

Answer :  B

Question : Which of the following clause of Memorandum of Association cannot be altered
(a) Name
(b) Object
(c) Situation
(d) Liability

Answer :  D

Question : 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 :  C

Question : 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 :  D

Question : 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 :  B

Question : _______________ 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 :  D

Question : The Prospectus must be issued to the public within ______________ days of its date.
(a) 30
(b) 60
(c) 90
(d) 100

Answer :  C

Question : 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 :  B

Question : Section 12 of Companies Act 1956, deals with
(a) Incorporation
(b) Share capital
(c) Number of Directors
(d) Shareholders

Answer :  A

Question : _____ 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 :  C

Question :  It is necessary to get every company incorporated, whether private or public.   True

Question :  A private company can commence business after incorporation.  True

Question : Experts who help promoters in the promotion of a company are also called promoters.   False

‘Question :  Articles of Association’ is the main document of a company.  False

Question :  Every company must file Articles of Association.  False

Question :  If a company suffers heavy issues and its assets are not enough to pay off its liabilities, the balance can be recovered from the private assets of its members.  False