REVISION QUESTIONS

CH-2: FORMS OF BUSINESS ORGANISATIONS

1. The structure in which there is separation of ownership and

management as per law
a) Company
b) All business organisation
c) Partnership
d) Sole proprietorship

2. In which form of business organisation, a minor can also be a

member?
a) Co-operative society
b) Joint stock company
c) Joint Hindu family
d) Partnership

3. Sudhir contributes to the capital and shares the profits and

losses of the firm. But he does not take part in the day to-day
activities of the firm. Identify the type of partner in the above
situation.
a) Active partner
b) Dormant partner
c) Secret partner
d) Partner by holding out

4. The liability of all the co-parceners except the...........is

limited to their share in the business, and consequently their
risk is well-defined and precise.
a) Karta
b) Partners
c) Members
d) Shareholders
5. The members comprise of consumers desirous of obtaining
good quality products at reasonable prices.
a) Consumer’s cooperative societies
b) Producer’s cooperative societies
c) Marketing cooperative societies
d) Farmer’s cooperative societies

6. The company form of organisation is governed by The

Companies Act, ..............
a) 1912 b) 2013 c)1966 d) 1965

7. The members of these societies consist of people who are

desirous of procuring residential accommodation at lower
costs.
(a) Consumer’s cooperative societies
(b) Producer’s cooperative societies
(c) Marketing cooperative societies
(d) Cooperative housing societies

8. It can continue as long as the partners want and is terminated

when any partner gives a notice of withdrawal from
partnership to the firm.
(a) Partnership at will
(b) Particular partnership
(c) General Partnership
(d) Limited Partnership

9. The principle of ‘one man one vote’ governs the cooperative

society.
(a) True (b) False (c) Partly True (d) None of these

10. A company is a creation of law and exists independent of

its members.
(a) Formation
 (b) Separate legal entity
(c) Perpetual succession
(d) Artificial person

11. Mr. Sharma was unable to assume the responsibility of all

managerial tasks such as purchasing, selling, financing etc.
Good workers started leaving the organisation. The goodwill
of the business in the market went on declining. In no time,
the liabilities of the business became many times more than
the assets. On account of the pressure exerted on him by the
creditors, Mr. Sharma had to repay the debts of the business
by disposing off his personal properties.
a. Identify the form of business organisation discussed in the
above para.
b. Quoting the relevant lines from the para, explain any two
limitations of the form of business organisation identified in part
(a) of the question.

12. Ramesh’s father gifted him a cricket bat on his birthday.

The cost of the bat was Rs. 800. Few months later, Ramesh
sold it to his friend, Kartik for Rs.850. He was very happy to
earn a profit of Rs. 50. He was boosted by this transaction
and after completing his studies, he formed a partnership
business with his friend Kartik trading in bats and other
sports material under the name M/s Ramesh Traders. Ramesh
and Kartik both act like an agent as well as principal of each
other. Firm soon started earning good profits. Ramesh’s
father suggested that they need to spend some money on
social responsibilities. They then decided to donate free
sports goods to schools which were financially weak.
a. Can the transaction between Ramesh and Kartik be termed as a
business transaction?
b. Can the transactions between M/s Ramesh Traders and other
persons be termed as business transactions? Give reason.
c. State and explain the feature of partnership form of business
mentioned above?
d. Identify the objective of business fulfilled by M/s Rakesh
Traders by donating sports goods.