Tag: ownership structures - joint stock company

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Questions Related to ownership structures - joint stock company

Multiple choice elements of business ownership structures - joint stock company meaning and objectives of public sector enterprises introduction to public sector organisations types of companies - private & public
The statutory meeting is compulsory for a public company .

  1. True

  2. False
Reveal answer Fill a bubble to check yourself
A Correct answer
Explanation

Every public company that is a limited company and has a share capital shall, within a period of not less than one month and not more than three months after the date at which it is entitled to commence business, hold a general meeting of the members of the company to be called the "statutory meeting"

Multiple choice elements of business ownership structures - joint stock company meaning and objectives of public sector enterprises introduction to public sector organisations types of companies - private & public

Select the correct option given below:

The quorum for general meeting of a public company according to the Companies Act, 1956 is _______.

  1. 2

  2. 5

  3. 8

  4. 10
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

Under the Companies Act, 1956, the quorum for a general meeting of a public company depends on the number of members, but 5 is the standard answer often cited in older textbooks for specific meeting types.

Multiple choice elements of business ownership structures - joint stock company meaning and objectives of public sector enterprises introduction to public sector organisations types of companies - private & public
State the following statement is True or False:
Before the statutory meeting the secretary has to draft the statutory report.

  1. True

  2. False
Reveal answer Fill a bubble to check yourself
A Correct answer
Explanation

The company secretary is responsible for drafting the statutory report, which must be sent to members before the statutory meeting.

Multiple choice elements of business ownership structures - joint stock company meaning and objectives of public sector enterprises introduction to public sector organisations types of companies - private & public

State the following statements is True or False:

The first general meeting of a public company is the Statutory meeting.

  1. True

  2. False
Reveal answer Fill a bubble to check yourself
A Correct answer
Explanation

The statutory meeting is the first formal general meeting held by a public company after its incorporation.

Multiple choice elements of business ownership structures - joint stock company meaning and objectives of public sector enterprises introduction to public sector organisations types of companies - private & public

Select the option from the option choices given in below and re-write the completed sentences:
A public company may adopt _____ in place of Articles of Association.

  1. Table A

  2. Memorandum of Association

  3. Prospectus

  4. None of these
Reveal answer Fill a bubble to check yourself
A Correct answer
Explanation
The Articles of Association are drawn for internal administration of the Company. The articles of the company, besides containing the regulations of the company shall also include such additional matters as may be necessary for its management.

Under Companies Act, 1956, it was not mandatory for a public company limited by shares to have its Articles, as it could adopt the entire Table A of its articles; however under Companies Act, 2013, it is mandatory for every company to have its own articles.
Multiple choice elements of business ownership structures - joint stock company meaning and objectives of public sector enterprises introduction to public sector organisations types of companies - private & public

Select the option from the option choices given in below and re-write the completed sentences:
A _________ company must issue prospectus to the public for capital subscription.

  1. statutory

  2. private

  3. public

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

Prospectus is a detailed statement that must be issued by a company that goes public. It is an invitation to the member of the public. It includes any notice, circular, advertisement inviting deposits from the public. Hence, a public company must issue prospectus to the public for capital subscription.

Multiple choice elements of business ownership structures - joint stock company meaning and objectives of public sector enterprises introduction to public sector organisations types of companies - private & public

Fill in the blanks:
A public company must publish ________ for raising capital.

  1. prospectus

  2. articles of association

  3. memorandum of association

  4. None of these
Reveal answer Fill a bubble to check yourself
A Correct answer
Explanation
Sec. 2(36) of the Companies Act describes a prospectus as “any document issued as a prospectus and includes any notice, circular, advertisement or other document inviting deposits from the public or inviting offers from the public for the subscription or purchase of any share in, or debentures of a body corporate.”

In other words, it is a document which invites deposits from the public or invites offers from the public for the subscription of shares in, or debentures of, a company. The words “inviting deposits from the public” were added by the Companies (Amendment) Act, 1974.
Thus a public company must publish prospectus for raising capital.
Multiple choice elements of business ownership structures - joint stock company meaning and objectives of public sector enterprises introduction to public sector organisations types of companies - private & public

Many private limited companies convert into public limited companies because _____.

  1. they do not want to change their business

  2. they want to gain the benefits of limited liability

  3. they want to get guarantee from its members

  4. they want to raise additional capital to expand the business
Reveal answer Fill a bubble to check yourself
D Correct answer
Explanation

Private limited company is a type of company that offers limited liability, or legal protection to its share holders. Many private limited companies who want to expand their business convert themselves into public limited companies. As the public limited companies are widely spread they can expand the business easily.