Finance bits -company law

What is a company?

• An association of people for a common purpose.

• A legal entity created by law to provide services and earn profits.

• A group of individuals sharing common interests.

• Both a and b.

Which of the following is NOT a feature of a company?

• Perpetual Succession

• Ownership of Property

• Unlimited Liability

• Common Seal

Perpetual succession means:

• The company can be dissolved at any time.

• The company continues to exist even if shareholders change.

• The company cannot enter into contracts.

• The company has unlimited liability.

Which document is required to start a company?

• MOA

• AOA

• Both MOA and AOA

• Articles of Incorporation

The primary document that outlines the external rules and regulations of a company is:

• Articles of Association (AOA)

• Bylaws

• Memorandum of Association (MOA)

• Charter

The clause in the MOA that specifies the company's authorized capital is the:

• Name Clause

• Objective Clause

• Capital Clause

• Liability Clause

Which of the following is a prohibited name for a company?

• Names similar to existing company names.

• Names that end with "Ltd."

• Names that end with "Pvt. Ltd."

• Any name chosen by the promoter.

What does the term 'Limited Liability' mean for shareholders?

• They are liable for all company debts.

• They are only liable for the unpaid amount on their shares.

• They are liable for company debts beyond their investment.

• They have no liability.

Which document outlines a company's internal rules and regulations?

• MOA

• AOA

• Charter

• Prospectus

Preliminary expenses are:

• • Recurring expenses of the company.

• • Expenses incurred during the formation of the company.

• • Expenses for purchasing machinery.

• • Operating expenses.