.M.S.N. DASS (P.G.
) COLLEGE, BUDAUN
MID – TERM ( 2023– 24)
BBA 4th Semester Company Law MCQs
Time:1:00 Hour
1. A company can alter its Articles of Association by passing a special resolution. What percentage of
votes is typically required to pass a special resolution?
a) 25% b) 50%
c) 60% d) 75%
2 In the context of company law, what is the meaning of the term "quorum"?
a) The number of directors required to be present at a board meeting
b) The minimum number of members required to form a meeting
c) The total number of shares issued by the company
d) The total number of employees in the company
3. A public limited company must issue a prospectus before offering its shares to the public. What
information does the prospectus typically contain?
a) The names of the company directors
b) The company's financial statements for the past five years
c) The objectives of the company and the terms of the issue
d) The names of the company's major shareholders
4. What is the purpose of holding an Extraordinary General Meeting (EGM) in a company?
a) To elect new directors to the board
b) To discuss routine matters of the company
c) To approve fundamental changes in the company's structure or operations
d) To distribute dividends to shareholders
5. The process by which a private company is transformed into a public company is known as:
a) Mergers and Acquisitions b) Amalgamation
c) Conversion d) Dissolution
6 Which officer in a company is responsible for maintaining the company's statutory registers, such as
the register of members and register of directors?
a) Chief Executive Officer (CEO) b) Chief Financial Officer (CFO)
c) Company Secretary d) Chief Operating Officer (COO)
7. What is the maximum number of partners allowed in a partnership firm according to company law in
many countries?
a) 5 partners b) 10 partners
c) 20 partners d) Unlimited number of partners
8 In a company limited by guarantee, what is the liability of the members?
a) Limited to the amount unpaid on their shares
b) Limited to the amount of their share capital
c) Limited to the guarantee amount they have undertaken
d) Unlimited
9. What is the minimum number of directors required for a one-person company?
a) 1 director b) 2 directors
c) 3 directors d) 5 directors
10. A company can issue new shares to existing shareholders without offering them to the public. What
is this process called?
a) Private Placement b) Initial Public Offering (IPO)
c) Rights Issue
(2)
11. Which governing body regulates company registration and operation in most countries?
a) International Monetary Fund (IMF) b) United Nations (UN)
c) World Trade Organization (WTO) d) Companies Registrar
12. What is the minimum number of members required to form a private limited company in most
jurisdictions?
a) One member b) Two members
c) Three members d) Four members
13. The liability of shareholders in a limited liability company is:
a) Limited to the value of their shares b) Unlimited
c) Limited to the assets of the company d) Determined by the board of directors
14. Which of the following statements is true regarding the board of directors in a company?
a) The board must consist of at least five members.
b) All board members must be shareholders of the company.
c) The board is responsible for day-to-day operational decisions.
d) The board is elected by the shareholders to manage the company.
15. Which type of company offers its shares to the general public for subscription and trading on the
stock exchange?
a) Sole proprietorship b) Partnership
c) Private limited company d) Public limited company
16. In a merger, two or more companies combine to form:
a) A new company b) A subsidiary company
c) A holding company d) A partnership firm
17. Which document contains the rules and regulations for the internal management of a company?
a) Memorandum of Association (MOA) b) Articles of Association (AOA)
c) Certificate of Incorporation (COI) d) Prospectus
18. When a company is unable to pay off its debts, it is declared:
a) Insolvent b) Bankrupt
c) Dissolved d) Defunct
19. What is the maximum number of partners allowed in a private limited company?
a) 10
b) 50
c) 100
d) 200
20 . The winding-up of a company refers to:
a) The process of selling off company assets to repay creditors.
b) The process of selling company shares to the public.
c) The process of transferring ownership of the company to new shareholders.
d) The process of closing down the company and distributing its assets to shareholders.
