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B Com Exam  >  B Com Test  >  Company Law  >  Test: Documents- 2 - B Com MCQ

Documents- 2 - Free MCQ Practice Test with solutions, B Com Company Law


MCQ Practice Test & Solutions: Test: Documents- 2 (10 Questions)

You can prepare effectively for B Com Company Law with this dedicated MCQ Practice Test (available with solutions) on the important topic of "Test: Documents- 2". These 10 questions have been designed by the experts with the latest curriculum of B Com 2026, to help you master the concept.

Test Highlights:

  • - Format: Multiple Choice Questions (MCQ)
  • - Duration: 10 minutes
  • - Number of Questions: 10

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Test: Documents- 2 - Question 1
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Which document defines a company's objects, fundamental conditions, and scope of activities?

Detailed Solution: Question 1

The Memorandum of Association is the main document of a company that defines its objects and lays down fundamental conditions upon which the company is formed. It governs the company's relationship with the outside world, its activities, and its purposes.

Test: Documents- 2 - Question 2
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In a company limited by shares, what does the "Liability Clause" specify?

Detailed Solution: Question 2

In a company limited by shares, the "Liability Clause" specifies that the liability of the members is limited. This means that shareholders are only liable to pay the unpaid portion of their shares and are not personally liable for the company's debts.

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Test: Documents- 2 - Question 3
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What is the significance of the "Object Clause" in the Memorandum of Association?

Detailed Solution: Question 3

The "Object Clause" in the Memorandum of Association defines the company's objectives and powers. It outlines the purposes for which the company is formed and sets limits on its activities. This clause provides important information to shareholders and those dealing with the company.

Test: Documents- 2 - Question 4
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What is the purpose of mentioning the registered office in the Memorandum of Association?

Detailed Solution: Question 4

Mentioning the registered office in the Memorandum of Association is essential to establish the company's domicile for legal communications. It serves as the place for delivering notices, receiving communications, and determining jurisdiction in legal matters.

Test: Documents- 2 - Question 5
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What is the purpose of a 'Statement in Lieu of Prospectus' according to Section 70 of the Companies Act?

Detailed Solution: Question 5

According to Section 70 of the Companies Act, a company having a share capital that does not issue a prospectus or has not proceeded to allot any public subscription shares must deliver a 'Statement in Lieu of Prospectus' to the Registrar. This statement provides necessary information to potential shareholders in lieu of a full prospectus.

Test: Documents- 2 - Question 6
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How many subscribers are required to sign the Memorandum of Association in a public company?

Detailed Solution: Question 6

In a public company, at least 7 subscribers are required to sign the Memorandum of Association. Their signatures must be attested by at least one witness each.

Test: Documents- 2 - Question 7
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What happens if a company carries on business for more than 6 months with less than the required number of members?

Detailed Solution: Question 7

If a company carries on business for more than 6 months while having less than the required number of members (7 for a public company), the members aware of this fact become personally liable for the company's debts incurred during that period.

Test: Documents- 2 - Question 8
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What does the 'Capital Clause' in the Memorandum of Association state?

Detailed Solution: Question 8

The 'Capital Clause' in the Memorandum of Association states the amount of share capital with which the company is to be registered and the division of this capital into shares of fixed amounts.

Test: Documents- 2 - Question 9
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In a company limited by guarantee, what does each member undertake to contribute towards?

Detailed Solution: Question 9

In a company limited by guarantee, each member undertakes to contribute to the assets of the company, in case of winding up, towards the debts and liabilities of the company, as well as the costs and expenses of the winding-up process.

Test: Documents- 2 - Question 10
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What is the primary purpose of the 'Statement in Lieu of Prospectus'?

Detailed Solution: Question 10

The primary purpose of the 'Statement in Lieu of Prospectus' is to provide information to potential shareholders when a prospectus is not issued. It delivers necessary information about the company's background, operations, and financials in the absence of a full prospectus.

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About this B Com Practice Test

This test contains 10 MCQs on Documents- 2 with detailed solutions for each question. It is part of the Company Law course on EduRev, designed to align with the current B Com syllabus. Each solution explains not just the correct answer but also gives you an understanding of the topic — not just to attempt the question but also help you prepare for the exam with practice.

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If you found this Documents- 2 MCQ Test helpful, you can further enhance your B Com preparation with in-depth courses on EduRev, for all the subjects and topics available in Company Law course. The course offers:
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