Forms of Business Organisation MCQ Class 11 Business Studies

9/26/21, 2:23 PM Forms of Business Organisation MCQ Class 11 Business Studies
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MCQs
Forms for Class
of Business 11
Organisation  Class 11
MCQ
CBSE Notes for Class 11 

Forms of Business Organisation MCQ Class 11 Business Studies are covered in this
Article. Forms of Business Organisation MCQs Test contains 74 questions. Answers to
MCQs on Forms of Business Organisation Class 11 Business Studies are available at the
end of the last question. These MCQ have been made for Class 11 students to help check
the concept you have learnt from detailed classroom sessions and application of your
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Forms of Business Organisation MCQ Class 11 Business Studies
1.The most popular form of business organisation is:
a) Sole proprietorship
b) Company
c) Partnership
d) Joint Hindu Family business
2. The form of business organisation which is specifically found in India is:
b) NGO
c) Cooperative society
3. Cooperative Societies are compulsorily registered under which of the following Act:
a) The Companies Act, 2013
b) The Cooperative Societies Act, 1922
c) The Indian Contract Act, 1872
d) The Cooperative Societies Act, 1912
4. How many types of Cooperative Societies are there:
a) 5
b) 4
c) 6
d) 8
https://arinjayacademy.com/forms-of-business-organisation-mcq-class-11/ 1/18
d) 8
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MCQs for Class 11 
5. Satish
CBSElost his job
Notes forduring
Classthe 
11Covid-19 pandemic now he wants to start a business of
his own in his hometown, Satish had limited finance available with him and he does not
want many legal formalities to start a business, suggest Satish which forms of business
organisation he should go for:
a) Partnership
b) Sole proprietorship
c) Joint hindu family business
d) Cooperative society
6. Which of the following forms of business organisation has limited liability to his
members:
a) Partnership
b) Company
c) Sole proprietorship
7. Minimum number of members required to form a public company is:
a) 12
b) 1
c) 7
d) No limit
8. As per The Companies Act, 2013, a public company is defined as:
a) A company which is not a private company
b) A company which has restrictions on the transferability of its shares
c) A company which is prohibited from issuing shares to the public
d) A company which has limited the number of its members upto 200
9. Amit is performing a business activity in which he enjoys all the profits and bears all the
risk alone, which type of organisation do you think Amit is running:
a) Partnership
b) Company
b) Company
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d) Joint stock company

10. A is running a retail shop of grocery items under the sole proprietorship form of
business, A’s son wants him to expand the shop and deal in other types of goods as well
but CBSE
A doesNotes for with
not agree Classhis11 
son’s plan. Do you think that A’s son can execute his plan
without A’s consent?
a) Yes
b) No
c) Yes but after completing a few legal formalities
d) None of these
11. Which of the following is a demerit of a partnership firm:
a) Unfair distribution of profits
b) Unlimited liability
c) Limited managerial ability
d) Dominance of one partner
12. Harish was a sole proprietor and was running a retail shop of gift items. Unfortunately,
due to an accident Harish died, due to which his business also came to an end. Which
feature of the sole proprietorship is applied here:
a) No separate entity
b) Lack of business continuity
c) Sole risk bearer and profit recipient
d) None of these
13. Which type of organisation is not bound to show its accounts to anyone:
a) Company
b) Partnership
14. Sense of accomplishment is present in which of business organisation:
a) Partnership
b) Company
b) Company
c) Joint Hindu Family business
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d) Sole proprietorship

15. Pooja is engaged in a business of clothes. She has to manage all the tasks related to
the business alone and because of her weak marketing skills and knowledge her business
CBSE
is not Notes
making forup
profits Class 
11expectations. Pooja’s business is a ________ form of
to her
business organisations:
a) Joint Hindu Family Business
c) Partnership
16. The Indian Partnership Act, 1932 defines Partnership as:
a) The relation between persons who have agreed to share the profits of the business
carried on by all or any one of them acting for all.
b) The relation between persons who have agreed to carry on business activities together.
c) The relation between persons who have agreed to share the profits of the business
carried on by all of them together.
d) None of these
17. The partners of a partnership firm have unlimited liability, this means that:
a) Partner’s personal assets cannot be used for repaying the firm’s debt
b) Partner’s personal assets can be used to repay the firm’s debt/liability
c) Partners will enjoy unlimited profits
d) Profit is distributed according to the amount of their capital contribution.
18. A, B and C together made a donation of Rs.60,000 to an organization called Smart

Healthcare Club. Can this contribution be called as partnership:
a) Yes
b) No
c) Yes, if the amount contributed by A,B and C is equal
d) None of these
19. Which of the following is not an advantage of a partnership firm:
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a) Secrecy
b) Ease of Formation and Closure
MCQs for Class 11

c) Limited liability of members

d) More funds
20. Ram, Shyam and Kavi were in a partnership firm. Kavi wants his son to enter into the
firm, Shyam agrees to this but Ram does not agree to Kavi’s intentions. Can Kavi bring his
son to the partnership firm even if Ram does not agree
a) Yes
b) No
c) Yes, but after completing certain legal formalities
d) None of these
21. Possibility of conflicts is a limitation of which type of business organisation:
b) Partnership
c) Company
22. How many types of partners are there:
a) 5
b) 7
c) 6
d) 2
23. Partner who does not take part in the day to day activities of the business is a ________
partner:
a) Active
b) Dormant
c) Secret
d) None of these
24. Partner who does not contribute to the capital neither takes part in the management
of the firm but still he/she is liable to pay the firm’s debt because they are considered to
be a partner of the firm in the eyes of a third party:
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a) Dormant
b) Nominal
c) Active

d) Partner by estoppel
25. On the basis of duration partnership are classified into:
a) Partnership at will and particular partnership
b) General partnership and limited partnership
c) Long partnership and short partnership
d) None of these
26. In a limited partnership, the liability of at least one partner is _______ while of other
partners is _______:
a) Limited; unlimited
b) Limited; general
c) General; unlimited
d) Unlimited; limited
27. Document that is made during the formation of a partnership is:
a) Partnership agreement
b) Partnership deed
c) Partnership registration
d) Partnership document
28. Which of the following is not mentioned in the partnership deed:
a) Name of the firm
b) Duration of business
c) Method of solving disputes
d) Amount of profit and losses
29. It is ________ for a partnership firm to get registered:
a) Mandatory
b) Optional
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c) Necessary
d) None of these

30. Which of the following is a consequence of not registering the partnership firm
a) A partner cannot file a suit against the partner or the firm

b) ACBSE Notes
partner for
cannot fileClass
a suit11
against third parties

c) Firm cannot file a suit against any of its partners
d) All of these
31. A partnership firm can be registered under:
a) The Partnership Act, 1932
b) The Indian Contract Act, 1872
c) The Partnership Act, 1994
d) The Partnership Act,1922
32. The Joint Hindu Family business is governed by which of the following laws:
a) Hindu law, 2002

b) Hindu Undivided law, 1994
c) Hindu Family law, 1965
d) Hindu Succession Act, 1956.
33. The person in the Joint Hindu Family business who carries on the business and is the
head of the family is called the _______:
a) Karta
b) Director
c) Sole proprietor
d) Head of the business
34. All members who have equal ownership rights over the property of an ancestor are
known as __________:
a) Family members
b) Coparceners
c) Business Partners
d) Heirs of the Business
35. The liability of the Karta is______, while that of the other members is _______:
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a) Limited; unlimited
b) Unlimited; limited
MCQs for Class 11

c) Limited; limited

d) Unlimited; unlimited
36. Can a minor be a member in a Joint Hindu Family business:
a) Yes
b) No
c) Partially yes
d) Yes, if all the members make an agreement of entering him/her
37. Which among these is a merit of a Joint Hindu Family business:
a) Limited managerial skills
b) Disputes among the members
c) Effective control
d) Limited resources
38. Which of these is a limitation of the Joint Hindu Family business:
a) Unlimited liability of all the members
b) Limited managerial skills
c) Delay in decision making
d) Lack of public confidence
39. Can a minor be entered into a partnership firm
a) No
b) Yes
c) Yes, but by mutual consent of the partners and only to share profits
d) None of these
40. ________ is an example of a cooperative society in India
a) Amul
b) Infosys
c) Wipro
d) All of these
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41. Which of the organisation has a feature of separate legal entity from its members:
a) Company
CBSE Notes
b) Cooperative for Class 11
society

d) Both A and B
42. The main motive of a cooperative society is:
a) To earn profits
b) To provide service to its members
c) To inculcate a habit of savings among members
d) To cooperate and work as a team with members
43. Why does the cooperative societies has a merit of government support:
a) Because these societies exemplifies the idea of democracy
b) Because these societies are formed for the welfare of the members
c) Because these societies help in the development of the country
d) Because government wants to increase the number of such societies
44. How does the Cooperative societies raise its capital:
a) By issuing shares to its members
b) By issuing shares to the public
c) By getting donations
d) None of these
45. Which of the following is a limitation of a Cooperative society:
a) Unlimited resource
b) Government Control
c) Complexity in formation
d) Delay in decision making
46. ________is formed to protect the welfare of farmers:
a) Producers cooperative society
b) Consumers cooperative society
c) Farmers cooperative society

c) Farmers cooperative society
d) Marketing cooperative society

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47. Gokuldham society is made by a group of people in which these members are able to
construct/buy houses at reasonable cost. This is an example of:
MCQs for Class 11

a) Cooperative credit society

b) Marketing cooperative society
CBSE Notes
c) Cooperative for Class
housing 11
society

d) Producer’s cooperative society
48. The chief managing body of a company is:
a) Board of Directors
b) Shareholders
c) Debenture holders
d) All of these
49. A private company is one which:
a) Limits the number of members
b) Restricts the transferability of shares
c) Prohibits the public to subscribe to its securities
d) All of these
50. Common seal of a company acts as its:
a) Official signature of the company
b) Signature of the Board of Directors
c) Signature of the promoters
d) Signature of the CEO
51. A company being an artificial person can:
a) Enter into contracts
b) Can sue the third party or its members
c) Can be sued by its members or any other third party
d) All of these
52. Which of these is a merit of a company:
a) Quick decision making
b) Lack of secrecy
c) Professional management
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d) Ease of formation

53. Priyansh formed a private company named ABC pvt ltd. After the death of Priyansh
the company continued its operations because of its_______ feature:
CBSE Notes
a) Common seal
for Class 11 
b) Limited liability
c) Artificial person
d) Perpetual succession
54. ________ are the real owners of a company:
a) Shareholders
b) Board of directors
c) Promoters
d) Employees
55. The process for forming a Joint Stock Company is:
a) Complex
b) Easy
c) Easier than sole proprietorship
d) Easier than Partnership
56. Reliance Industries is a _______ company:
a) Private
b) Public
c) Subsidiary
d) NGO
57. A company named Tech pvt ltd wants to issue its shares to the general public. Can the
company do so:
a) Yes
b) Yes, after taking permission from the government
c) Yes but there will be a few restrictions

c) Yes but there will be a few restrictions
d) No
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58) The limit of maximum number of members in a public company is:
a) 100
b) 200

c) 500
CBSEisNotes
d) There no limitfor 
Class 11 number of members in a public company
of maximum
59) Minimum number of members required to form a private company is:
a) 5
b) 3
c) 2
d) 4
60) Aman wants to start a business which requires good managerial skills. Which type of
business organisation do you think Aman should form:
b) Company
c) Joint Hindu Family business
61) Which of these types of partners does not participate in the management of the firm:
a) Sleeping partner
b) Partner by estoppel
c) Partner by holding out
d) All of these
62) A _________ partner contributes to the capital but does not participate in the
management:
a) Active
b) Dormant
c) Partner by estoppel
d) Partner by holding out
63) Partners who do not share profit or losses:
a) Nominal partner
b) Partner by estoppel
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c) Partner by holding out
d) All of these
MCQs for Class 11

64) _______ type of partner have unlimited liability:

a) Active
CBSE Notes for Class 11

b) Sleeping

c) Nominal
d) All
65) Unlike sole proprietorship and partnership, a company has large financial resources
and therefore there is a scope for________ of the company:
a) Earning more profit
b) Expansion
c) More recruitment
d) None of these
66) The most inexpensive way of starting a business is:
b) Partnership
c) Company
d) Cooperative societies
67) Ajay wants to start a business in which the initial cost required is the least. He should
go for a:
a) Company
b) Cooperative society
c) Sole Proprietorship
d) Joint Hindu Family Business
68) Minimum number of directors required in a public company is____and in a private

company is_____:
a) 7; 2
b) 3; 2
c) 1; 1
d) 10; 5
69. Binod wants to start a business organisation but he is afraid that in case the assets of
69. od a ts to sta t a bus ess o ga sat o but e s a a d t at case t e assets o
his business fall short of repaying the liabilities, his personal assets could also be used to
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repay the liabilities. Suggest Binod which form of business organisation he should start
so that his fear comes to an end:
a) Partnership
MCQs for Class 11


c) Company
CBSE
d) Joint Notes
Hindu for Class
Family 11
Business 
70) A company is created by ______ and only ______ can bring an end to its life:
a) Law; law
b) Promoters; law
c) Shareholders; promoters
d) Directors; promoters
71) Is it compulsory for a private company to have index of members:
a) Yes
b) Partially yes
c) Partially no
d) No
72) The continuity of a company is stable because of:
a) Separate legal entity
b) Perpetual succession
c) Common seal
d) Artificial person
73) Minimum number of members required to form a cooperative society is:
a) 5
b) 4
c) 10
d) 1
74) In case of running a Joint Hindu Family business there must be at least _____
members in a family.
a) 6
b) 4
c) 2
d) 8
d) 8
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MCQs for Class 11


Correct
CBSE Answer
Notes for Class 11 
1. A) Sole proprietorship
2. D) Joint Hindu Family business
3. D) The Cooperative Societies Act, 1912
4. C) 6
5. B) Sole proprietorship
6. B) Company
7. C) 7
8. A) A company which is not a private company
9. C) Sole proprietorship
10. B) No
11. B) Unlimited liability
12. B) Lack of business continuity
14. D) Sole proprietorship
15. B) Sole Proprietorship
16. A) The relation between persons who have agreed to share the profits of the
business carried on by all or any one of them acting for all.
17. B) Partners’s personal assets can be used to repay the firm’s debt/liability
18. B) No
19. C) Limited liability of members
20. B) No
21. B) Partnership
22. C) 6
23. B) Dormant
24. D) Partner by estoppel
25. A) Partnership at will and particular partnership
26. D) Unlimited; limited
27. B) Partnership deed
28. D) Amount of profit and losses
)
29. B) Optional
30. D) All of these Sign Up
31. A) The Partnership Act, 1932
32. D) Hindu Succession Act, 1956.
MCQs for Class 11

33. A) Karta

34. B) Coparceners
CBSE
35. Notes forlimited
B) Unlimited; Class 11 
36. A) Yes
37. C) Effective Control
38. B) Lack of managerial skills
39. C) Yes, but by mutual consent of the partners
40. A) Amul
41. D) Both A and B
42. B) To provide service to its members
43. A) Because these societies exemplifies the idea of democracy
44. A) By issuing shares to its members
45. B) Government Control
46. C) Farmers cooperative society
47. C) Cooperative housing society
48. A) Board of Directors
49. D) All of these
50. A) Official signature of the company
51. D) All of these
52. C) Professional management
53. D) Perpetual succession
54. A) Shareholders
55. A) Complex
56. A) Private
57. D) No
58. D) There is no limit of maximum number of members in a public company
59. C) 2
60. B) Company
61. D) All of these
62. B) Dormant
63. D) All of these
64. D) All
65. B) Expansion
66. A) Sole proprietorship

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68. B) 3; 2
69. C) Company
MCQs for Class 11
70. A) Law; law

71. D) No
CBSE
72. Notes for
A) Separate Class
legal 11
entity 
73. C) 10
74. C) 2
Class 11 Business Studies MCQs with Answers
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CBSE Notes for Class 11 