Commerce Accountancy · Law Legal Studies

Business Organizations and Corporate Governance

1,402 Questions

Business organizations and corporate governance explore company structures, stakeholder responsibilities, and regulatory frameworks under the Companies Act. These commerce topics are essential for Chartered Accountancy, company secretary exams, and banking probationary officer assessments. Practice these questions to master corporate formation, director roles, and business ownership types.

Companies Act 2013 provisionsCorporate stakeholder rolesPrivate limited company rulesDebenture holder rightsCompany incorporation rulesState-owned enterprises

Business Organizations and Corporate Governance Questions

Multiple choice elements of accounts introduction of financial statement of company general instructions for preparation of balance sheet tools of financial statements uses, importance, and limitation of financial statements

Trade associations may analyse the financial statements for the purpose of providing service and protection to the _________.

  1. owners

  2. shareholders

  3. managers

  4. members
Reveal answer Fill a bubble to check yourself
D Correct answer
Explanation

A financial statement is a collection of data organised according to logical and consistent accounting procedures. Its purpose is to convey an understanding of some financial aspects of a business firm.

One of the importance of financial statement is it aids trade associations in helping their members as Trade associations may analyse the financial statements for the purpose of providing service and protection to their members. They may develop standard ratios and design uniform system of accounts.

Multiple choice elements of accounts introduction of financial statement of company general instructions for preparation of balance sheet tools of financial statements uses, importance, and limitation of financial statements

___________ of the companies are interested in knowing the status, safety and return on their investment.

  1. Owners

  2. Managers

  3. Shareholders

  4. Directors
Reveal answer Fill a bubble to check yourself
C Correct answer
Explanation

The users of financial statements include management, investors, shareholders, creditors, government, bankers, employees and public at large.

Shareholders of companies are interested in knowing the status, safety and return on their investment. They may also need information to take decision about continuation or discontinuation of their investment in the business. Financial statements provide information to the shareholders in taking such important decisions.

Multiple choice elements of accounts introduction of financial statement of company general instructions for preparation of balance sheet tools of financial statements uses, importance, and limitation of financial statements

A person who is indebted to the company for which amount cannot be appointed to set as an auditor of a company?

  1. As may be prescribed
  2. $1,000$
  3. $3,000$
  4. $5,000$
Reveal answer Fill a bubble to check yourself
A Correct answer
Explanation

Section $141(3)$, of the companies act, $2013$ defines disqualification of the auditor. As per this section a person who is indebted to the company for an amount exceeding one thousand rupees, or who has given any guarantee or provided any security in connection with the indebtedness of any third person to the company for an amount exceeding one thousand rupees is disqualified to be appointed as auditor.

Multiple choice organisation of commerce and management micro, medium and small enterprises (msmes) nabard and kvic funding and assistance to small businesses privileges and other promotional measures for msmes world bank

Branch office kind of business form __________________.

  1. can undertake any acctivity

  2. can undertake activity which is specifically permitted.

  3. can work without being registered with Registrar of Companies.

  4. can not carry on research work.
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

A branch office is an extension of the parent company and can only perform activities that are specifically permitted by the regulatory authority (like the RBI in India). It is not an independent legal entity and must be registered.

Multiple choice commerce emerging service business in india franchising outsourcing and franchising recent trends of business employment opportunities in commerce

______ usually set strict rules and regulations as to how the franchisees should operate while running their business.

  1. Franchising

  2. BPO

  3. KPO

  4. All of the above
Reveal answer Fill a bubble to check yourself
A Correct answer
Explanation

Franchising is based on a marketing concept which can be adopted by an organization as a strategy for business expansion. Where implemented, a franchiser licenses its know-how, procedures, intellectual property, use of its business model, brand, and rights to sell its branded products and services to a franchisee. 

Multiple choice commerce emerging service business in india franchising outsourcing and franchising recent trends of business employment opportunities in commerce

Providing permission to use technical know how by parent organisation to another individual is known as ________.

  1. dealership

  2. marketing

  3. agency

  4. franchising
Reveal answer Fill a bubble to check yourself
D Correct answer
Explanation

Franchising is a form of business by which the owner (franchisor) of a product, service or method obtains distribution through affiliated dealers franchisees. If buying an existing business doesn't sound right for you but starting from scratch sounds a bit intimidating, you could be suited for franchise ownership.

Multiple choice commerce emerging service business in india franchising outsourcing and franchising recent trends of business employment opportunities in commerce

Franchising is___________.

  1. purchasing all parts of the company

  2. allowing another party to use product or service under owner's name

  3. joining two or more companies

  4. a company acquiring another company at its will
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

Franchising is based on a marketing concept which can be adopted by an organization as a strategy for business expansion. Where implemented, a franchiser licenses its know-how, procedures, intellectual property, use of its business model, brand and rights to sell its branded products and services to a franchise. for example Mc Donald, KFC etc.

Multiple choice commerce emerging service business in india franchising outsourcing and franchising recent trends of business employment opportunities in commerce

The individual or firm which grants right is called _________ (X). Whereas the individual or firm to whom the right is granted is called _________.(Y).
Select the correct answer from the options given below.

  1. (X) = Franchisee; (Y)=Franchiser

  2. (X) = Franchiser; (Y)=Franchisee

  3. (X) = Consignor; (Y)=Consignee

  4. (X) = Consignee; (Y)=Consignor
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

Franchising is basically a specialised form of licensing in which the franchiser not only sells intangible property (normally a trademark) to the franchisee, but also insists that the franchisee agrees to abide by strict rules as to how it does business.

Multiple choice commerce emerging service business in india franchising outsourcing and franchising recent trends of business employment opportunities in commerce

The individual or firm which grants right is called_________.

  1. Franchisee

  2. Franchiser

  3. Consignor

  4. Consignee
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

A franchisor is a person or company that grants the license to a third party for the conducting of a business under the franchisor's marks. The franchisor owns the overall rights and trademarks of the company and allows its franchisees to use these rights and trademarks to do business.

Multiple choice organisation of commerce and management structure of business e-tailing e-advertising, e-marketing and e-security e-commerce and mobile commerce

Parties involved in the electronic transactions are from within a given business firm is known as ____________.

  1. B2B

  2. B2C

  3. C2C

  4. Intra-B
Reveal answer Fill a bubble to check yourself
D Correct answer
Explanation

Intra-B Commerce refers to the transactions that takes place between the parties or persons who are the part of one firm only. Generally a firm deals with customers, suppliers, employees etc. These are called intra business transactions.

Multiple choice organisation of commerce and management government organisation meaning and features of government company government companies forms, comparison and cases of public enterprises

As per Companies Act $2013$, a company is -
A. Formed and registered under the Companies Act, $2013$
B. An existing company registered under any earlier Companies Act
Select the correct answer from the options given below.

  1. A only

  2. B only

  3. A or B

  4. A but not B
Reveal answer Fill a bubble to check yourself
C Correct answer
Explanation

A company, which is incorporated under the relevant legislation of a foreign country, will not qualify as a company under the 2013 Act The proviso to section 2(71) states that “a company which is a subsidiary of a company, not being a private company, shall be deemed to be a public company for the purposes.

Multiple choice organisation of commerce and management government organisation meaning and features of government company government companies forms, comparison and cases of public enterprises

Identifying marks of a public limited company are __________.

  1. Formation

  2. Number of members

  3. Directors and meetings

  4. All of the above
Reveal answer Fill a bubble to check yourself
D Correct answer
Explanation

A company whose securities are traded on a stock exchange and can be bought and sold by anyone. Public companies are strictly regulated, and are required by law to publish their complete and true financial position so that investors can determine the true worth of its stock (shares). Also called publicly held company.

A company is called as private limited when all its shares are in private hands while the shares in a Public Limited company are open to everyone. 2. Pvt Ltd Company is owned by a group of promoters. In Private Limited companies, the minimum number of shareholders should be two and the maximum 50.

Multiple choice organisation of commerce and management government organisation meaning and features of government company government companies forms, comparison and cases of public enterprises

____ formed by the government to meet some governmental and political purposes.

  1. A foreign corporations

  2. A public corporation

  3. A Private corporations

  4. A professional corporations
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

Public Corporation is a body corporate created by an Act of Parliament or Legislature. Its name is notified in the official gazette of the Central or State Government. It is an artificial person with the flexibility of the private sector and the powers of the government. They are set up with the objective of carrying out a specific type of commercial activity. These organizations are formed for administering nationalized industries or undertakings. Many service organizations of the government are set up in the form of corporations. It is formed and operated basically with a service motive. Profits are only a secondary consideration. For eg: FIC,  LIC,  ONGC etc.

Multiple choice organisation of commerce and management government organisation meaning and features of government company government companies forms, comparison and cases of public enterprises

The government company cannot enter into contract or acquire property in its own name.

  1. True

  2. False
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation
A government contractor is a company (privately owned or publicly traded but not a state-owned enterprise) either for-profit or non-profit – that produces goods or services under contract for the government. Ownership is the state or fact of exclusive rights and control over property, which may be an object, land/real estate or intellectual property. 
Ownership is self-propagating in that the owner of any property will also own the economic benefits of that property.