R4RIN – MCQs, Mock Tests | Business Studies Business Studies-[Class 11-MCQS ]-Chapter 7 Formation of a Company

Preliminary Contracts are

1. binding on the Company
2. binding on the Company, if ratified after incorporation
3. binding on the Company, after incorporation
4. not binding on the Company

✅ Correct Answer: 4

Stages in the formation of a public company are in the following order

1. Promotion, Commencement of Business, Incorporation, Capital Subscription
2. Incorporation, Capital Subscription. Commencement of Business, Promotion
3. Promotion, Incorporation, Capital Subscription, Commencement of Business
4. Capital Subscription, Promotion, Incorporation, Commencement of Business

✅ Correct Answer: 3

A proposed name of Company is considered undesirable if

1. It is identical with the name of an existing company
2. It resembles closely with the name of an existing company
3. It is an emblem of Government of India, United Nations etc.
4. In case of any of the above

✅ Correct Answer: 4

Minimum number of members to form a public company is

1. 5
2. 7
3. 12
4. 21

✅ Correct Answer: 2

The company needs to obtain prior permision from central government when it changes the address of its registered office from

1. one city to another city
2. with in the same city
3. one state to another
4. one country to another country

✅ Correct Answer: 3

A person cannot hold directorship in more than ____ public companies

1. 3
2. 10
3. 20
4. 7

✅ Correct Answer: 3

Powers, rights, remuneration, qualification and duties of directors are discussed clearly in

1. Memorandum of Association
2. Articles of Association
3. Prospectus
4. none of the above

✅ Correct Answer: 2

______ means the total amount of called up capital on the shares issued and subscribed by the shareholders on capital account.

1. Called-up capital
2. subscribed capital
3. nominal capital
4. Paid-up capital

✅ Correct Answer: 1

_____ share capital has priority both in repayment of dividend as well as capital.

1. Equity
2. non preference
3. Preference
4. all of the above

✅ Correct Answer: 3

Par value of shares means the __________ value of the shares

1. Actual
2. face
3. Market
4. dividend

✅ Correct Answer: 4

The Prospectus must be issued to the public within ______________ days of its date

1. 30
2. 60
3. 90
4. 100

✅ Correct Answer: 3

A copy of the ________________ must accompany each from of application for shares offered to the public.

1. Memorandum of association
2. Prospectus
3. Articles of association
4. None of the above

✅ Correct Answer: 2

______ cannot give invitation to the public to subscribe for any shares in or debentures of the company

1. Subsidiary company
2. Statutory Company
3. Private company
4. Registered company

✅ Correct Answer: 3

A private company means a company which has a minimum paid up capital of Rs.————

1. 100,000
2. 500,000
3. 5,000,000
4. none of the above

✅ Correct Answer: 1

The shares of a _______________ company can be freely transferable

1. Private ltd
2. Public ltd
3. Partnership
4. all of the above

✅ Correct Answer: 2

“Men may come and men may go but the company exist”- this explains which characteristics of the company as per companies Act 1956

1. Separate legal entity
2. Perpetual Succession
3. Capacity to sue
4. None of the above

✅ Correct Answer: 2

Which of the following clause of Memorandum of Association cannot be altered

1. Name
2. Object
3. situation
4. liability

✅ Correct Answer: 2

Which of the following is not a clause of memorandum of association

1. situation
2. capital
3. subscription
4. directors

✅ Correct Answer: 4

The company will be considered as separate person and different from its members from the date (when the) __________

1. start of business
2. Apply for registration
3. receive incorporation certificate
4. mentioned in certificate

✅ Correct Answer: 4

The certificate of capital will be issued by

1. Registrar of companies Act
2. Controller of companies Act.
3. Registrar of capital issues
4. controller of capital issues

✅ Correct Answer: 4

A statement of nominal capital must be given at the time of incorporation by the company when the share capital is less than

1. 50 Lakh
2. 1 crore
3. 10 Lakh
4. 25 Lakh

✅ Correct Answer: 4

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

1. 15
2. 30
3. 60
4. 45

✅ Correct Answer: 2

The application for registration of a company should be presented to the _______________ of the state appointed under Companies Act 1956

1. Controller
2. registrar
3. Governor
4. registration officer

✅ Correct Answer: 2

Minimum number of members required to apply for incorporation certificate in a public ltd company is

1. 3
2. 2
3. 7
4. 50

✅ Correct Answer: 3

Preliminary Contracts are signed

1. Before the incorporation
2. After incorporation but before capital subscription
3. After incorporation but before commencement of business
4. After commencement of business

✅ Correct Answer: 1

A prospectus is issued by

1. A private company
2. A public company seeking investment from public
3. A public enterprise
4. A public company

✅ Correct Answer: 2

Application for approval of name of a company is to be made to

1. SEBI
2. Registrar of Companies
3. Government of India
4. Government of the State in which Company is to be registered

✅ Correct Answer: 2

Minimum number of members to form a private company is

1. 2
2. 3
3. 5
4. 7

✅ Correct Answer: 1

Private company prohibits any invitation or acceptance of deposits from persons other than its ______

1. Members
2. directors
3. Partners
4. banks

✅ Correct Answer: 1

A company is known as the _______company of another company if it has control over that other company.

1. subsidiary
2. holding
3. controlling
4. statutory

✅ Correct Answer: 2

For example Par value is Rs10 and it is issued at Rs15 then Rs5 is the ___________ amount

1. Profit
2. Market value
3. dividend
4. premium

✅ Correct Answer: 4

__ means the total amount of called up share capital which is actually paid to the company by the members

1. nominal capital
2. reserve capital
3. called up capital
4. Paid-up capital

✅ Correct Answer: 4

The dividend payable to ___________ share holders is payable on fixed figure or percent

1. Equity
2. non preference
3. Preference
4. all of the above

✅ Correct Answer: 3

_________ capital means the sum mentioned in the capital clause of Memorandum of Association

1. Full capital
2. Maximum capital
3. share capital
4. Nominal Capital

✅ Correct Answer: 4

If the company can make arrangements for raising the capital privately so that pubic appeal is unnecessary, the company is required to prepare a _________

1. Prospectus
2. statement in lieu of Prospectus
3. certificate of Prospectus
4. none of the above

✅ Correct Answer: 2

A Government Company means any company in which not less than 51% of the paid-up share capital is held by

1. Central Government
2. State government
3. Both a & b
4. Neither a nor b

✅ Correct Answer: 3

A private company means a company which has a minimum paid up capital of Rs.———

1. 100,000
2. 500,000
3. 5,000,000
4. none of the above

✅ Correct Answer: 2

___ are the company created by special act of the legislature

1. Registered company
2. Public Ltd Company
3. Private ltd company
4. Statutory company

✅ Correct Answer: 4

The liability of the members of the company can be limited by

1. Share
2. Guarantee
3. Both a & b
4. Neither a nor b

✅ Correct Answer: 3

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

1. 60
2. 45
3. 30
4. 7

✅ Correct Answer: 3

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

1. Passing a special resolution
2. obtaining permission from central government
3. Passing an ordinary resolution
4. Both a & b

✅ Correct Answer: 3

Number of clauses in Memorandum of Association is

1. 5
2. 6
3. 7
4. 8

✅ Correct Answer: 2

The articles of association needs to be signed by

1. all proposed directors
2. registrar
3. subscribers of memorandum
4. none of the above

✅ Correct Answer: 3

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

1. statement of capital
2. certificate of incorporation
3. certificate of capital
4. certificate of incorporation

✅ Correct Answer: 3

Among the following which documents are not mandatory to be submitted to the registrar along with incorporation application by a private company.

1. Address of Registered office & undertaking
2. Undertaking and statement of capital
3. statement of capital & list of directors
4. list of directors and statement of capital

✅ Correct Answer: 1

Number of documents to be submitted, by a public ltd company, to the registrar while applying for incorporation of the company is

1. 3
2. 2
3. 7
4. 50

✅ Correct Answer: 3

The application for registration of a company should be presented to the registrar of the state in which the _______________ of the company is to be situated

1. Manufacturing plant
2. first branch
3. business office
4. any of the above.

✅ Correct Answer: 3

Section 12 of Companies Act 1956, deals with

1. Incorporation
2. Share capital
3. Number of Directors
4. Share holders

✅ Correct Answer: 1