MCQ on Business Organisation with Answers pdf | MCQ on Business Organisation and Management with Answers pdf
1. In which of the following business organisations there is separation of ownership and management?
(a) Sole-proprietorship
(b) Partnership
(c) Hindu undivided family
(d) Company
Ans. d
2. In a Joint Hindu Family System, a Karta has
(a) limted lability
(b) unlimited liability
(c) no liability
(d) None of the above
Ans. b
3. Co-operative societies follow the principle of
(a) one man-one vote
(b) one man-many votes
(c) Both ‘a and b’
(d) None of the above
Ans. a
4. In a joint stock company, the board of directors is elected by
(a) the govemment
(b) the shareholders
(c) the employees
(d) None of the above
Ans. b
5. In a partnership form of organisation carrying on a banking business, the maximum number of partners allowed are
(a) 10
(b) 15
(C) 20
(d) None of these
Ans. a
6. For a partnership firm comprising of professionals who are governed by a separate act, the maximum number of partners can be
(a) 50
(b) 20
(c) 100
(d) 10
Ans. c
7. As per Companies Act, 2013 the number of members of a private company (excluding present or past emiployees who ure members also) cannot exceed
(b) 100
(d) 200
(a) 50
(c) 150
Ans. d
8. Profits are not required to be shared. This is a distinct feature of
(a) sole proprietorship
(b) partnership
(c) joint stack company
(d) co-operative society
Ans. a
9. The capital of a company is divided into a number of parts each such part is called
(a) share
(b) debenture
(c) stock
(d) None of these
Ans. a
10. The head of the Joint Hindu Family is referred to as
(a) Director
(c) Karta
(b) Pramukh
(d) CEO
Ans. c
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11. The members of the Joint Hindu Family are referred to as
(b) co-parceners
(d) None of these
(a) shareholders
(c) partners
Ans. b
12. A business organisation is formed to provide members residential accommodation at reasonable rates. This business organisation is an example of
(a) consumer co-operative society
(b) produces co-operative society
(c) housing co-operative society
(d) None of the above
Ans. c
13. Mohan is a partner of AB firm but his association is unknown to the general public. Mohan is a
(a) active partner
(b) sleeping partner
(c) partner-by-estoppel
(d) secret partner
Ans. d
14. A person who by his words or conduct gives an impression to others that he is a partner of the firm, is known as
(a) partner-by-estoppel
(b) partner by holding-out
(C) nominal partner
(d) None of the above
Ans. a
15. A person is represented as a partner and he does not deny such impression, despite of being aware of such a fact. “Such a person is
(a) partner-by-estoppel
(b) partner by holding-out
(c) dormant partner
(d) None of the above
Ans. b
16. Minimum number of members in a public company can be
(a) 2
(c) 10
(b) 7
(d) None of these
Ans. b
17. Minimum number of members in a private company can be
(a) 2
(c) 10
(b) 7
(d) None of these
Ans. a
18. A proposed name of a company is not considered desirable if
(a) it closely resembles the name of an existing company
(b) it is identical to the name of an existing company
(c) it is an emblem of a statutory body
(d) in case of any of the above
Ans. d
19. A’ prospectus’ or a ‘statement in lieu of prospectus’ can be issued by
(a) a public company
(c) Either ‘a’ or ‘b’
(b) a private company
(d) None of these
Ans. a
20. The order of the stages in the formation of a public company are
(a) promotion, commencement of business, capital subscription, incorporation
(b) promotion, incorporation, capital subscription, commencement of business
(c) incorporation, promotion, capital subscription, commencement of business
(d) incorporation, promotion, commencement of business, capital subscription
Ans. b
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21. Preliminary contracts are those which are signed
(a) before incorporation
(b) after incorporation but before capital subscription
(c) after incorporation but before commencement of business
(d) after commencement of business
Ans. a
22. Preliminary contracts are
(a) binding on the company after incorporation
(b) not binding on the company after incorporation
(c) binding on the company after commencement of business
(d) None of the above
Ans. b
23. For which of the following business, a partnership form of organisation would be suitable?
(a) Grocery store
(b) Craft centre
(c) Internet cafe
(d) Chartered Accountancy Firm
Ans. d
24. For which of the following business, sole proprietorship form of organisation would be suitable?
(a) Iron and steel factory
(c) Craft centre
(b) Legal consultancy
(d) None of these
Ans. c
25. The Dayabhaga’ system of Hindu undivided family business is prevalent in
(a) West Bengal
(b) All over India
(c) All over India except West Bengal
(d) None of the above
Ans. a
26. Partnership is governed by
(a) Indian Partnership Act, 1935
(b) Indian Partnership Act, 1932
(c) Indian Partnership Act, 1947
(d) None of the above
Ans. b
27. Hindu Undivided Family Business is governed by
(a) Hindu Succession Act, 1956
(b) Hindu Succession Act, 1947
(c) Hindu Succession Act, 1952
(d) None of the above
Ans. a
28. If a Hindu inherits property from father, grandfather or great-grandfather, then such property is termed as
(a) willed property
(c) seit-acquired property
(b) ancestral property
(d) None of these
Ans. b
29. If a Hindu inherits property from any other relative (other than father, grandfather or great-grandfather) then this property is termed as
(a) willed property
(c) sell-acquired property
(b) ancestral property
(d) None of these
Ans. c
30. Which of the partner (s) does not contribute towards the capital of the firm?
(a) Nominal partner
(c) Partner by holding-out
(d) All of these
(b) Partner by entoppel
Ans. d
31. In a limited partnership.
(a) lability of all the partners is limited
(b) iability of atleast one partner is unlimited, whernas, rest of the partners may have limited lability
(c) kability of all the partners, except one is unlimited
(d) None of the above
Ans. b
32. Partnership agreement may be
(a) vertal
(b) in writing
(c) verbal or in writing
(d) None of the above
Ans. c
33. The consequences of non-registration of a partnership firm are
(a) a partner of an unregisteted tim canriot fie a suit against the fimm or other partrers
(b) the firm cannot file a suit against third parties
(c) the firm cannot file a case against the partners
(d) All of the above
Ans. d
34. The registration of a partnership firm is
(a) compulsory
(b) optional
(c) neither. compulsory nor optional
(d) None of the above
Ans. b
35. A co-operative society is compulsorily required to be registered under
(a) the Cooperative Societies Act, 1912
(b) the Cooperative Societies Act. 1932
(c) the Cooperative Societies Act, 1952
(d) None of the above
Ans. a
36. The maximum number of members in a co-operative society can be
(a) 10
(c) 200
(b) 50
(d) No such limit is there
Ans. d
37. ‘Amul’ is an example of
(a) public imited company
(b) private limited company
(c) co-operative society
(d) None of the above
Ans. c
38. Lack of secrecy is a limitation faced by which of the following organization(s)?
(a) Public limited company
(b) Co-operative society
(c) both a and b
(d) None of the above
Ans. c
39. A joint stock company is governed by
(a) the Companies Act, 1956
(b) the Companies Act, 2013
(c) the Companies Act, 1952
(d) None of the above
Ans. b
40. A private company is one which by its articles
(a) restricts:the right of its members to transfer shares
(b) prohibits any invitation to the general public to subscribe for its shares
(c) must have a minimum paid-up capital of rs. 1 lakh
(d) All of the above
Ans. d
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41. … is personally liable for the preliminary contracts.
(a) Director
(b) Promoter
(d) None of the above
(c) Both a and b
Ans. b
42. The legal position of a promotor is that of
(a) an agent
(b) a trustee
(c) an agent as well as a trustee
(d) neither an agent nor a trustee
Ans. d
43. If the promotor does not disclose the secret profits earned by him and the company gets to know about it, the company can
(a) cancel the contract
(b) recover the purchase price paid to the promotors
(c) claim damages for the loss suffered
(d) All of the above
Ans. d
44. The promotors have to select a name for the company and get it approved from the registrar of companies. It has to be ensured that the name selected does not match with the name of any other company. For this, . names are given to the registrar in order of preference.
(a) two
(b) three
(c) four
(d) six
Ans. b
45. The Memorandum of Association must be signed by atleast. persons in case of a public company and by persons in case of a private company.
(a) 2, 2
(c) 5, 2
(b) 7, 2
(d) None of these
Ans. b
46. The important document(s) required to be submitted to the registrar to get a company registered is/are
(a) Articles of Association
(b) Consent of Proposed Directors
(c) Statutory Declaration
(d) all of the above
Ans. d
47. …. is also known as ‘situation clause’ or ‘domicile clause
(a) Objects clause
(c) Capital clause
(b) Registered office clause
(d) Liability clause
Ans. b
48. ….. is a document containing the rules and regulations for the internal management of the company.
(a) The Memorandum of Association
(b) The Prospectus
(c) The Charter of the company
(d) The Articles of Association
Ans. d
49. Acts done beyond the scope of memorandum are . and cannot be
(a) valid, dismissed
(c) invalid, enforced
(b) invalid, ratified
(d) None of these
Ans. b
50. A public limited company may either have its own articles or may adopt….. given in the Companies Act.
(a) Table A
(b) Table B
(c) Schedule IV
(d) Schedule VI
Ans. a
51. A statutory declaration is to be submitted to the registrar stating that all the legal requirements with the Companies Act with regard to incorporation have been complied with. This statement has to be signed by
(a) Advocate of High Court or Supreme Court
(b) Chartered Accountant/Company secretary in full time practice
(c) Person named in the articles as Director
(d) Any of the above
Ans. d
52. The amount of registration fees payable at the time of registration of a company
(a) is rs.10000
(b) is rs. 12000
(c) depends on the authorised capital of the company
(d) None of the above
Ans. c
53. Assertion (A) Management is a continuous process involving the integration of all functions.
Reason (R) Management first plans, then organizes and finally performs the function of controlling, Codes
(a) Both A and R are true and R is the correct explanation of A
(b) Both A and R are true, but R is not the correct explanation of A
(c) A is true, but R is false
(d) A is false, but R is true
Ans. c
54. “Management means forecasting. planning, organising. directing, coordinating and controlling”. Who said this?
(a) Peter F Drucker
(c) Parkins
(b) Henri Fayol
(d) FW Taylor
Ans. b
55. Which of the following is not a part of management?
(a) Planning
(c) Budgeting
(b) Staffing
(d) Communication
Ans. c
56. “Management an art of getting work done by others”. The statement belongs to
(a) Stainley Vense
(c) Henri Fayol
(b) Peter F Drucker
(d) Harold Koontz
Ans. d
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57. Which of the following statements is/are false?
1. Management is a thinking function of top-level management
2. Management does not ensure utilization of available resources to achieve some objectives.
3. Management means managing men tactfully to get things done.
Select the correct answer using the codes given below.
(a) 1 and 2
(c) 1 and 3
(b) Only 3
(d) None of these
Ans. b
58. Father of modern management is
(a) Henri Fayol
(c) FW Taylor
(b) Koontz and ODonnell
(d) Stainley Vense concerned with
Ans. a
59. Management
(a) legislative functions
(c) executive functions
(b) administrative functions
(d) All of these
Ans. c
61. Assertion (A) Management ensures maximum production at minimum cost.
Reason (R) Management eliminates wastes as far as practicable.
Codes (a) Both A and R are true and R is the correct explanation of A
(b) Both A and R are true, but R is not the correct explanation of A
(c) A is true, but Ris false
(d) A is false, but R is true
Ans. a
62. According to Fayol, ‘Functions of management’ are
(a) planning and organisation
(b) direction and coordination
(c) control
(d) All of these
Ans. d
64. Democratic leader
(a) can avoid the exercise of authority
(b) can avoid the responsibility for what happens to his organisation
(c) must be tough enough to win fight
(d) must kick an employee when he is down
Ans. c
65. Management is pervasive in the sense that
(a) it fulfills all purposes
(b) it uses all resources effectively
(c) it is relevant for all organisations
(d) All of the above
Ans. c
66. All managerial functions are settled by managers with the jo joo)
(a) planning
(b) decision-making
(c) effective control
(d) authority
Ans. b
67. Which of the following statements is correct?
(a) Management cannot generate a favourable working environment
(b) An ideal management takes the right decisions on all matters
(c) Management activities need not to be result oriented
(d) None of the above the right time
Ans. b
69. According to management are
(a) planning-implementation-control
(b) planning-organisation-coordination
(c) planning-resource mobilisation-education
(d) planning-implementation-monitoring
Ans. a
70. Which of the following is not correctly matched?
(a) Management is the art and science of decision-making and leadership-Donald J Clough
(b) Management is the art of directing and inspiring people-George R Terry
(c) Management is the function of executive leadership anywhere-Raiph C Davis
(d) None of the above
Ans. a
71. Assertion (A) Management is a dynamic function which is to be performed continuously.
Reason (R) Policies and procedures of management are quickly changed to cope with the changing business environment.
Codes(a) Both A and R are true andR is the correct explanation of A
(b) Both A and R are true, but Ris not the correct explanation ofA
(c) A is true, but Ris false
(d) A is talse, but R is true
Ans. a
72. ….can remove all the problems and can run the business on the right track
(a) Statting
(c) Administratiori
(b) Management
(d) Coordination
Ans. b
73. Which type of leader use the style with unskilled workers where a great deal of control is needed?
(a) Situational leaders
(b) Transactional ieaders
(c) Transformational leaders
(d) Democratic leaders
Ans. b
75. Assertion (A) Authoritative style of decision-making comes from the top.
Reason (R) It is a joint collaboration of the leader and his subordinates.
codes (a) Both A and R are true and R is the correct explanation of A
(b) Both A and R are false, but Ris not the correct explanation of A
(c) A is true, but A is fatse
(d) A is faise. but Ris true
Ans. c
76. To prepare plans regarding the work, is performed by
(a) lower levei management
(b) board of directors
(c) middle level management
(d) All of the above
Ans. a
77. The cycle of management continues to operate so long as
(a) there is profit earned by an enterprise
(b) there is an organisation
(c) there is completion of group goals
(d) there is existence of partnership
Ans. b
78. According to Massie and Douglas, “Managemnent is the process by which a . group directs action of others towards common goals”.
(a) co-operative
(b) small
(c) large
(d) social
Ans. a
79. The leaders that require a strong vision are called situational leaders
(b) transactional leaders
(c) transformational leaders
(d) None of the above
Ans. c
80. An autocratic leadership style exerts . control over the employees.
(a) partial
(c) complete
(b) no
(d) None of these
Ans. c
81. General manager is in
(a) top level management
(b) middle level management
(c) lower level management
(d) None of the above
Ans. a
82. Top management of a company consists of
1. Board of Directors
2. Managing directors
3. Chief executives
4. Foreman
5. Clerks
Codes (a) 1, 2 and 3
(c) 1 and 5
(b) 1, 2 and 5
(d) 2, 3 and 4
Ans. a
83. To motivate employees to achieve higher productivity’ s the function of
(a) middle level management
(b) lower level management
(c) top level management
(d) None of the above
Ans. a
84. Management is called a process because
(a) it is applicable to the manufacturing process
(b) it is relevant for social organisations
(c) it involves a series of functions
(d) None of the above
Ans. c
85. Who is the founder of administrative management?
(a) Elton Mayo
(c) Max Weber
(b) FW Taylor
(d) Henri Fayol
Ans. d
86. Arrange the following functions of a manager in an organisation in correct sequence.
1. Motivation
2.Controlling
4. Planning
3. Organising
Codes (a) 3, 4, 1. 2
(c) 4, 3, 1, 2
(b) 3, 4, 2, 1
(d) 4, 3, 2, 1
Ans. d
88. According to views expressed by different management authorities, management and administration are
(a) synonymous
(c) Both ‘a’ and ‘b’
(b) different
(d) None of these
Ans. b
89. Consider the following statements.
1. Planning is the primary function of management.
2. Efficiency means doing the right task, completing activities and achieving goals.
3. Management is not universally necessary in all organisation.
Which of the statements given above is/are correct?
(a) Only 1
(c) Both ‘a’ and ‘b’
(b) Only 2
(d) None of these
Ans. a
93. Which of the following is not an element of delegation?
(a) Accountability
(b) Authority
(c) Responsibility
(d) Informal organisation
Ans. d
94. Staffing involves
(a) orientation and appraisal
(b) training and development
(c) recruitment
(d) All of the above
Ans. d
95. Span of management refers to
(a) number of managers
(b) length of term for which a manager is appointed
(c) number of subordinates under a superior
(d) number of members in top management
Ans. c
97. Shivalika Limited decides to advertise its products on radio and newspapers. Here, type of plan is
(a) objectives
(c) rules
(b) budget
(d) strategy
Ans. d
98. The last step in the process of controlling is
(a) analysing deviations
(b) measurement of actual performance
(c) setting performance standards
(d) taking corrective action
Ans. d
99. Important aspect of staffing is
(a) recruitment
(c) training
(b) selection
(d) All of these
Ans. d
100. Principles of directing involves
(a) unity of direction
(c) span of management
(b) unity of command
(d) None of the above
Ans. b
101. ‘Harmony of objectives’ is a principle of
(a) directing
(c) controlling
(b) planning
(d) organising
Ans. a
102. The main advantage of functional organisation is
(a) simplicity
(c) experience
(b) specialisation
(d) authority
Ans. b
103. Which of the following is the most democratic form of organisation?
(a) Line
(c) Functiona
Ans. b
104. Plan made in the light of competitor’s plan is known as
(b) Line and staff
(d) Committee
(a) policy
(c) strategy
(b) procedure
(d) undercover plan
Ans. c
105. A proposed organisational change may create.
(a) emotional turmoil and tension
(b) problem of social displacement
(c) fear of known
(d) All of the above
Ans. d
106. Identify the correct sequence of steps involved in planning.
1. Selecting the best course of action.
2. Establishing the sequence of activities.
3. Establishment of objectives.
Ans. b
107. Which of the following statements is/are correct?
(a) Transfer is an external source of recruitment
(b) Promotion does not involve higher position, status and responsibilities
(c) Advertisement is an external source of recruitment
(d) All of the above
Ans. c
