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Commerce Exam  >  Commerce Test  >  Business Studies (BST) Class 11  >  Test: Forms Of Business Organisations - 1 - Commerce MCQ

Test: Forms Of Business Organisations - 1 - Commerce MCQ


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10 Questions MCQ Test Business Studies (BST) Class 11 - Test: Forms Of Business Organisations - 1

Test: Forms Of Business Organisations - 1 for Commerce 2026 is part of Business Studies (BST) Class 11 preparation. The Test: Forms Of Business Organisations - 1 questions and answers have been prepared according to the Commerce exam syllabus.The Test: Forms Of Business Organisations - 1 MCQs are made for Commerce 2026 Exam. Find important definitions, questions, notes, meanings, examples, exercises, MCQs and online tests for Test: Forms Of Business Organisations - 1 below.
Solutions of Test: Forms Of Business Organisations - 1 questions in English are available as part of our Business Studies (BST) Class 11 for Commerce & Test: Forms Of Business Organisations - 1 solutions in Hindi for Business Studies (BST) Class 11 course. Download more important topics, notes, lectures and mock test series for Commerce Exam by signing up for free. Attempt Test: Forms Of Business Organisations - 1 | 10 questions in 10 minutes | Mock test for Commerce preparation | Free important questions MCQ to study Business Studies (BST) Class 11 for Commerce Exam | Download free PDF with solutions
Test: Forms Of Business Organisations - 1 - Question 1
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This is a MCQ (Multiple Choice Question) based practice test of Chapter 2 - Forms of Business Organisations of Business Studies of Class XI (11) for quick revision of School Board examinations.

The structure in which there is separation of ownership and management as per law is called

Detailed Solution for Test: Forms Of Business Organisations - 1 - Question 1

Answer: B — Company.

A company is a separate legal entity where the ownership (shareholders) and management (board of directors and managers) are distinct by law.

In a sole proprietorship and most partnerships, owners are directly involved in management and there is no statutory separation.

Test: Forms Of Business Organisations - 1 - Question 2
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The karta in Joint Hindu family business has

Detailed Solution for Test: Forms Of Business Organisations - 1 - Question 2

The karta is the head and manager of the Hindu Undivided Family (HUF) and acts on behalf of the family in its business affairs.

Because an HUF is not a separate legal entity, the karta is personally responsible for liabilities incurred in the course of the family business; therefore the karta has unlimited liability.

Hence option C is correct.

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Test: Forms Of Business Organisations - 1 - Question 3
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In a cooperative society, the principle followed is?

Detailed Solution for Test: Forms Of Business Organisations - 1 - Question 3

Cooperative societies are democratic organisations where control is equally distributed among members.

One member one vote.

Each member has an equal vote regardless of the number of shares held.

This contrasts with the one share one vote principle used in companies limited by shares.

Test: Forms Of Business Organisations - 1 - Question 4
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The board of directors of a joint stock company is elected by
Detailed Solution for Test: Forms Of Business Organisations - 1 - Question 4

In a joint-stock company the board of directors is elected by the shareholders at the general meeting.

Shareholders exercise voting rights according to their shareholding, unless the company's articles provide otherwise.

Employees, government bodies and the general public do not elect the board unless they act in the capacity of shareholders and vote at the general meeting.

Test: Forms Of Business Organisations - 1 - Question 5
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The maximum number of partners allowed in the banking business are

Detailed Solution for Test: Forms Of Business Organisations - 1 - Question 5

As per Section 11(2) of the Companies Act, 1956 (and reaffirmed under the Companies Act, 2013, Section 464, read with the relevant rules), the maximum number of partners allowed in a banking business is 20.

If a partnership firm engaged in banking exceeds this limit without registering as a company, it becomes illegal.

So,
Maximum number of partners in banking business = 20
Maximum in other business = 50 (as per Companies (Miscellaneous) Rules, 2014)

Test: Forms Of Business Organisations - 1 - Question 6
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Profits do not have to be shared. This statement refers to
Detailed Solution for Test: Forms Of Business Organisations - 1 - Question 6

Correct answer: D — Sole proprietorship

In a sole proprietorship a single person owns and runs the business and is entitled to all profits; there is no legal obligation to share profits with others.

By contrast:

Partnership — profits are shared among partners as per agreement.
Company — profits may be distributed as dividends to shareholders.
Joint Hindu family business — profits are shared among family members as per customary or legal rules.
Test: Forms Of Business Organisations - 1 - Question 7
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The capital of a company is divided into a number of parts, each of which is called?
Detailed Solution for Test: Forms Of Business Organisations - 1 - Question 7

Correct answer: D. Share

The capital of a company is divided into units called shares; each share represents a portion of ownership in the company.

Dividend: a distribution of profit to shareholders, not a part of capital.
Profit: the company's earnings after expenses, not a capital unit.
Interest: the cost of borrowed funds, not a part of capital.
Test: Forms Of Business Organisations - 1 - Question 8
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The Head of the joint Hindu family business is called

Detailed Solution for Test: Forms Of Business Organisations - 1 - Question 8

Correct answer: C — Karta.

In a Hindu Undivided Family (HUF), the member who manages the family business and affairs is called the Karta.

The Karta is typically the eldest male coparcener and has the authority to act on behalf of the family in business and property matters.

Test: Forms Of Business Organisations - 1 - Question 9
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Provision of residential accommodation to the members at reasonable rates is the objective of?
Detailed Solution for Test: Forms Of Business Organisations - 1 - Question 9

A housing cooperative is an organisation formed to provide residential accommodation to its members at reasonable rates.

Other cooperatives for contrast:

Consumers cooperative: supplies consumer goods to members at fair prices.
Credit cooperative: provides loans and financial assistance to members.
Producers cooperative: helps producers with inputs, processing or marketing of produce.

Correct answer: D. Housing cooperative

Test: Forms Of Business Organisations - 1 - Question 10
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A partner whose association with the firm is unknown to the general public is called?
Detailed Solution for Test: Forms Of Business Organisations - 1 - Question 10

Secret partner is a partner whose association with the firm is not known to the general public.

Active partner takes part in management and is publicly known.
Nominal partner lends name to the firm but is not actually a partner.
Sleeping (dormant) partner does not participate in management but their association with the firm is generally known.
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