CHAPTER - 2

FORMS OF BUSINESS ORGANISATION

Q1. Pankaj is running a chemist shop under the name ‘Bansal medicos’ in ashok vihar market.
He takes all the decisions about the business himself and there is no interference from others. He
also earns good profit as a direct reward for his risk bearing.
Identify the form of business organisation and briefly explain its limitations. (3)

Q2. “Karta is the most active member in the hindu undivided family business.”
Comment . (3)

Q3. Identify the type of partner highlighted in the following statements -

(a) This partner does not take part in day to day activities of the business.
(b) He gives an impression of his being a partner to others by his words of conduct.
(c) He allows to use his goodwill to benefit the firm and can be represented as a partner.
(d) He is represented as a partner and in spite of knowing this, he does not deny such an
impression.
(e) His association with the firm is not disclosed to the general public.
(f) This partner is also known as a dormant partner.
(g) This partner takes an active part in carrying out business of the firm.

Q4. Ankit, Kishore and Shivam are partners in a partnership firm manufacturing water coolers.
Recently Shivam entered into a contract with Mayank for purchase of raw materials worth ₹
10,00,000 without the knowledge of Ankit and Kishore. Now, Mayank is asking for the payment
and Ankit and Kishore are of the view that only Shivam is liable to make the payment and they
cannot be held liable. Are they correct in refusing the payment? State and explain the related
feature of the partnership form of business organisation. (3)

Q5. Rakesh started a garment shop a few years back. Due to continuous losses in the business, he
decided to close it down. However, he owes ₹ 2,00,000 to Aniket from whom he had purchased
garments on credit. His business funds are not sufficient to repay the debt. Can Aniket recover
his dues from the personal assets of Rakesh. (1)

Q6. Even Though registration of partnership firm is not compulsory, still partners prefer to get it
registered. Why? (3)

Q7. Prabhat and Rishi are doing separate business in installing centralised air conditioning units
in Mumbai. They entered into a partnership contract to install a centralized AC unit in a hotel in
Shirdi. Identify the type of partnership being highlighted in the given case. (1)
Q8. After completing the graduation, three close friends (Gopal, Shankar and Vinod) decided to
start a partnership business of manufacturing mobile accessories. However, all three of them are
confused about the type of partnership they should start.
● Gopal wants that the partnership should be such that it can be brought to an end at the
desire of any partner.
● Shankar wants to do the partnership business for a period of three years only.
● Vinod wants that his liability should be limited in the business.
Identify the types of partnership that the three friends are referring to. (3)

Q9. Three doctors (Dr. Sahil Gupta, Dr. Mayank Aggarwal and Dr. Karan chopra) decided to
start a charitable clinic. Will it be considered a partnership business? (1)

Q10. Fill in the blank with appropriate words -

(a) __________ cooperative society is formed by the consumers for obtaining good quality
products at reasonable prices.
(b) __________ cooperative society is formed by small independent producers to sell their
output through one centralised agency.
(c) __________ is formed by people who want to procure residential accommodation at
lower costs.
(d) ___________ cooperative society is formed to provide short term financial assistance to
the members.

Q11. Kanika is a shareholder in a company holding 6,000 shares of ₹ 10 each on which she has
already paid ₹ 8 per share. What will be her liability in the event of losses or company’s failure
to pay debts? Also, state the relevant feature of joint stock company. (3)

Q12. ‘Shares of a joint stock company are freely transferable’. Explain. (3)

Q13. Is it compulsory for partners to have a written agreement? (1)