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CBSE Questions for Class 10 Elements Of Business Joint Stock Company Quiz 2 - MCQExams.com
CBSE
Class 10 Elements Of Business
Joint Stock Company
Quiz 2
Incorporation of a Joint Stock Company is compulsory.
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True
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False
Explanation
Incorporation of a Joint stock company is compulsory. Without incorporation, all the contracts would be considered void in the eyes of law and operations of business cannot be carried out.
The business organisation, where there is a separation of ownership and management is a __________.
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Joint stock company
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Family business
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Co-operative society
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Government organisation
Explanation
In joint stock company there is separation of ownership and management and it involves placing the management of the firm under the responsibility of professionals who are not its owners. Owners of a company may include shareholders, directors, government entities and initial founders.
An association of individuals for profit, having its capital divided into a large number of shares is a _______.
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joint stock company
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co-operative organisation
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non-profit organisation
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none of the above
Explanation
The joint stock company collects huge capital from public by dividing its capital in a small unit called shares and inviting subscription from general public on these shares. Holding these shares ensures dividend to the shareholders and provides them voting powers in the decision making process of the business.
A Joint stock company has a _______ life/existence.
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continuous
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constant
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certain
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flexible
Explanation
One of the feature of joint stock company is that it has a perpetual existence that implies death or insanity of any of its member, board of directors, employees or shareholder cannot lead to the closure of company. It has a long business life i.e. cannot be easily diluted.
A business organisation registered under the Companies Act of 1956 is a _____ .
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Partnership firm
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Sole proprietorship
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Joint stock company
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Government organisation
Explanation
A business organisation registered under the Companies act 1956 is a Joint stock company. All the companies have to register itself with registrars under the Companies act 1956. It has been recently amended in the year 2013.
The third stage in the formation of a Joint Stock Company is ____________.
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incorporation
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capital raising
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promotion
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investment
Explanation
The third stage in the formation of Joint stock company is Capital subscription or raising. At this step, a company is allowed to raise their funds from general public by issuing shares and debentures. But before that it has to issue a prospectus for the public to subscribe to the capital of company.
The managing body of a Joint Stock Company is the ________ .
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Directors
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Board of Directors
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Shareholders
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None of these
Explanation
A joint stock company is managed by the board of directors who are elected by the shareholders. All the shareholders are entitled to vote in the decision making process. Board of directors holds company's shares in a huge lot and have powers in the management of the business.
Fill in the blanks:
The constitution of a joint stock company is called _______.
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memorandum of association
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articles of association
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table A
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None of these
Explanation
Memorandum of Association is the constitution of Joint stock company. It directs or instructs joint stock company. The joint stock company runs in accordance with the memorandum of association. Activities of the joint stock company are directed by the Memorandum of Association. Memorandum of association is regarded as a blueprint as it is needed for the incorporation of the joint stock company. Memorandum of Association is submitted to Company Registrar Office. Basic information and provision of the company are clearly mentioned in the memorandum of association. It defines scopes, objectives, functions of the joint stock company.
Select the correct option given below :
The management of a joint stock company is vested in the ____________.
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Director
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Board of directors
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Manager
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All of above
Explanation
Option B is the correct answer.
The management of a joint stock company is vested in the Board of Directors.
The term company is defined in section _______ of the Companies Act, $$2013$$.
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$$2$$
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$$3(1)(i)$$
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$$3(2)$$
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$$4$$
Explanation
As per section 2 of the Companies Act, 2013 a company is a company as created under the Companies Act, 2013 or any other previous companies act.
The form of business organisation in which there is separation of ownership and management is called _______.
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sole partnership
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partnership
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company
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all these
Explanation
Option C is the correct answer.
Write a word, term or a phrase which can substitute each of the following statements:
A report to be submitted to the Registrar according to Section 165.
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Annual report
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Statutory report
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Trade report
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None of these
Explanation
According to section 165 of the companies act 1965 the company has to file statutory report to registrar.
In India Companies are governed by ________.
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Indian partnership act, $$1932$$
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Companies act, $$1956$$ as amended from time to time
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Societies registration act
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all of the above
Explanation
In India companies are governed by the companies act, 1956 amended from time to time. The provisions of the act will apply to:
i) Any body corporate registered under the act.
ii) Insurance company except the ones registered under the insurance act 1938.
iii) Banking company except the ones registered under the Banking company act. 1949.
iv) Company supplying electricity and is not registered in the electricity generation act 1948.
A company pays dividend on its....
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Paid up value of share capital
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Called up value of share capital
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Subscribed capital
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Issued capital
Explanation
Option A is the correct aswer.
Company is a/an ______ association of persons
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voluntary
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compulsory
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legal
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chance
Explanation
Option A is the correct answer.
Write a word or a term or a phrase which can substitute each of the following statements:
A form of organisation where there is a separation of ownership from management ______________.
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Joint Stock Company
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Co-operative Society
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Public Company
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Private Company
Explanation
Option A is the correct answer.
A form of organisation where there is a separation of ownership from management is Joint Stock Company.
Who are the owners of a company
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Promoters
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Board of directors
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Chairman of the Company
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Shareholders
Explanation
Option D is the correct answer.
The liability of a shareholder of a company is to the extent of ________.
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face value of shares
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unpaid value of shares
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both
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none of the above
Explanation
Option B is the correct answer.
The maximum amount with which a company gets registered is called __________.
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authorized share capital
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issued share capital
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subscribed share capital
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paid up share capital
Explanation
The Authorised share capital
is the maximum amount of the capital for which shares can be issued by the Company to shareholders, the capital clause
is mentioned in the Memorandum of Association of the Company.
The Authorised capital can be increased at any time in the future by taking necessary steps as required by law or the Companies Act, 2013.
Thus the correct answer is A.
Limited liability is enjoyed by ________.
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a general partnership
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a corporation
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a sole proprietorship
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none of the above
Explanation
A corporation is a group of people or company authorized to act as a legal entity which is recognized by Law. It has a limited liability distinct from its members. The owner and the company are two different persons.
Characteristics of a company_________.
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Artificial legal person
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Incorporated body
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Capital divisible into shares
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All of above
Explanation
A company as an entity has many distinct features which together make it a unique organization. The essential characteristics of a company are the following:
1. Separate legal entity.
2. Limited liability.
3. Perpetual succession.
4. Transferability of shares.
5. Incorporated body.
The company can ___________.
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Enter into contracts
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Borrow money
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Open banking account in its name
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All of above
Explanation
Company is a distinct as well as legal entity and would be liable for his own.
Therefore, a company can borrow money, enter into contracts, open bank account in its name, purchase its own shares.
In an annual return of a company which is filed with ROC, the particulars to be mentioned are _____________.
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list of directors
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registered address of company
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list of shareholders
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all of the above
Explanation
In an annual return of a company which is filed with ROC in Form MGT-7, the following particulars to be mentioned are:
1. Capital of the Company
2. Shareholding of the members
3. List of Directors
4. Registered of the Company
5. Details of the meeting during the Financial Year, etc.
Thus the correct answer is D.
Managerial Personnel
Any corporate body or firm can be appointed as director of the company. This statement is
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0%
False
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True
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Partly true
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Partly false
Explanation
Option A is the correct answer.
Which of the following is / are disadvantage of company form of organization?
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The window dressing of the prospectus often misleads the investors who are later on exploited by the promoters
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Lack of secrecy
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Stock exchange speculation
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All of above
Explanation
A company is a distinct legal entity separate from its shareholders or officers. The following are the disadvantages
of a company form of organization:
1.
The window dressing of the prospectus often misleads the investors who are later on exploited by the promoters.
2.
Lack of secrecy.
3.
Stock exchange speculation.
4. Y
our financial affairs are public.
Thus the correct answer is D.
A Company Secretary _____________________.
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has nothing to do with the directors, of the company
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is never in touch with any government department
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occupies an important place in a corporate setup
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does not have to correspond with the investors
Explanation
Company secretary occupies an important place in a corporate set up. As per Companies Act 2013, a Company Secretary is a key managerial person.
The official signature of the company is known as ________.
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company logo
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company seal
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common seal
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common signature
Explanation
The official signature of the company is known as
the
company seal. It is
the corporate
seal
used by a
company for the d
ocuments that need to be executed as deeds. T
he company is an artificial person who acts through its Board of Directors. The Board of Directors enters into an agreement with others by indicating the company's approval through a
common seal
.
Thus the correct answer is C.
Mr. Varun is a rich man with ample amount of working capital. He wants to go for a business of chain of $$5$$ star holds. What kind of business organization you will suggest him_________________.
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company
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partnership
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sole Proprietorship
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trust
One of the disadvantages of a company form of business is ________.
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its full legal cover
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recognized legal entity
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stock exchange speculation
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none of the above
Explanation
Option C is the correct answer.
Disadvantages of Joint Stock Company
:
Difficulty in Formation: ADVERTISEMENTS
Reckless Speculation Encouraged
Fraudulent Management
Delay in Decision-Making
Monopolistic Powers
Excessive Regulation by Law
Conflict of Interests
Lack of Secrecy
Everything is an advantages of joint ventures except __________________.
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The costs of a new project can be split between the companies involved
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Manufacturing costs will be divided between the firms in the venture
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Joint ventures between firms in different countries can create new market opportunities
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Management of the joint venture will lead to disagreements
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