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    BST_class11_chp7

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    BST_class11_chp7

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    2 views4 pages

    BST_class11_chp7

    Uploaded by

    lavanyachawla24

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
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    BST_Class 11_chp7

    Formation of company

    CASE STUDIES
    1.

    Trinity Ltd. Is a company which manufactures blankets. The


    company needs addition capita for exansion of business. So it
    issue 50,000 shares of the face value of Rs. 100 each. Before,
    issuing shares the management of the company decided that
    they would issue such shares which will not impose any fixed
    financial charges. In the processus they investors woul be able
    to earn extra dividends. Teh company collected money from the
    public and the company' s business expanded.
    Identify and explain the type of shares issued by Trinity Ltd.

    2.

    Radhika Ltd. Has good growth prospects . So it si planning to


    expand their business. For this the company needs addtional
    funds. The finance manger reports that the company is not in a
    positionto bear extra burden of paying any fixed inancial
    charges like intrest or divident. They do not want to bear any
    flotation costs even. Alos, the equity shareholders insists not to
    issue further shares as there is risk of dilution of control.
    Suggest and expalin the source of finance most suitable for
    Radhika Ltd.
    3.
    Krishana Pvt. Ltd. Is facintg the shortages of long-term finance
    as it is a period of depression in the economy.
    The experts were consultd determine the source of finance the
    company should raise. One financial advisor, Mr. Ram, adviser
    that the company should use such a security on which it has a
    tax advantage and there is no dilution of controle of the
    shareholders. another finance specialist, Mr. Shiv advised that
    the company should not issued any debt or equity security but
    raise such a source of long-term finance which can be
    redeemed in easy instalments.
    Ouoting the relevant lines form the above para, identify and
    exaplain the source of finance sugested by the two specialists,
    Mr. Ram and Mr. Shiv

    MCQs:

    1.Which of the following are the functions of a promoter?


    (a) Appointment of professionals
    (b) Feasibility studies
    (c) Name approval
    (d) All of the above

    2.Which of the following document is to be submitted for getting


    the company registered?
    (a) Memorandum of Association
    (b) Articles of Association
    (c) Both a & b
    (d) None of the above

    3.________are neither the agents nor the trustees of the company


    (a) Registrar
    (b) Registree
    (c) Promoters
    (d) Preliminary Contracts

    4.Choose the correct steps for raising funds from the public.
    (i) SEBI Approval
    (ii) Minimum subscription
    (iii) Appointment of brokers, bankers, underwriters
    (iv) Application to the stock exchange
    (v) Filing of the prospectus
    (vi) Allotment of shares
    a) i>iii>iv>vi>ii>v
    b) i>ii>iii>iv>v>vi
    c) i>vi>iv>iii>ii>v
    d) i>v>iii>ii>iv>vi

    5.What does DIN stand for?


    (a) Director Identification Number
    (b) Direction Identification Number
    (c) Document Identification Number
    (d) Drug Identification Number

    6.When was One Person Company?


    (a) 2013
    (b) 2005
    (c) 2009
    (d) 2020

    7.As per the SEBI guidelines, the minimum subscription has to be


    90% of the shares to be issued to be public.
    (a) True
    (b) False
    (c) Partially true
    (d) Partially false

    8.____defines relationship of the company with the outsiders


    (a) Articles of Association
    (b) Memorandum of Association
    (c) Both (a) & (b)
    (d) None of the above

    9.Contracts signed by promoters with third parties before the


    incorporation of the company is called---
    (a) Preliminary Contracts
    (b) Provisional Contracts
    (c) Memorandrum of Association
    (d) Articles of Association

    10.Promoter is a person who---


    (a) Who has been named as such in a prospectus?
    (b) Who is identified by the company in the annual return referred
    to in section 92
    (c)Who has control over the affairs of the company, directly or
    indirectly whether as a shareholder, director, or otherwise
    (d)All of the above
    11.Different Clauses of Memorandum of Association are:
    (a) Name clause
    (b) Objects Clause
    (c) Liability clause
    (d) All of the above

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