Tag: organization of commerce and management

Questions Related to organization of commerce and management

Which of the following external factors influences capital structure?
I. Level of interest rates
II. Level of stock prices
III. Dilution of value
IV. Tax policy on interest and dividends
Of these:

organization of commerce and management markets and marketing meaning, nature and importance of services introduction to services nature and types of services

  1. I and IV are correct

  2. II and III are correct

  3. I, II and IV are correct

  4. All are correct

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Correct Option: C
Explanation:

C.

The capital structure of a company consists of debt and equity. When the interest rates increase, the company relies more on equity and when the interest rate decreases, the company will borrow more funds. 
When the share prices increase, the lending agencies are willing to give loans to the company and vice-versa.
When tax rates are high the business will borrow more funds rather than raising equity capital.

State the following statement is True or False:

The principle of 'one share one vote' is used in the poll voting method. 

organization of commerce and management markets and marketing meaning, nature and importance of services introduction to services nature and types of services

  1. True

  2. False

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Correct Option: A
Explanation:

As per Section 109 a poll may be demanded by such number of members holding, shares worth minimum value of Rs. Five Lakh or 10% voting power in the Company. Principle of “One share – One vote” is recognized under this method.

State the following statement is True or False:

A method of voting where members can vote in proportion to the number of shares held is called poll.

organization of commerce and management markets and marketing meaning, nature and importance of services introduction to services nature and types of services

  1. True

  2. False

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Correct Option: A
Explanation:

As per Section 109 a poll may be demanded by such number of members holding, shares worth minimum value of Rs. Five Lakh or 10% voting power in the Company. 

All the members in person or by proxy at a meeting have their voting right in a poll in proportion to the number of shares held by each of them.

A written record of the business transacted and the resolution passed at the meeting is minute.

organization of commerce and management markets and marketing meaning, nature and importance of services introduction to services nature and types of services

  1. True

  2. False

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Correct Option: A
Explanation:

Minutes of meeting is an official record of the proceedings of a meeting. A record of minutes of meeting is to be kept in a minutes book maintained at the Registered office of the company or at a place approved by the Board of Directors of the company.

State the following statement is True or False:

The Chairman's special voting right is called the casting voting.

organization of commerce and management markets and marketing meaning, nature and importance of services introduction to services nature and types of services

  1. True

  2. False

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Correct Option: A
Explanation:

Casting vote is called as second vote which is used by  Chairman in case of tie, to resolve a deadlock. 

If the Articles of the company so provide, the Chairman shall have a casting vote.

State the following statement is True or False:

A motion which brings to the notice of the Chairman certain irregularities of the meeting is point of order.

organization of commerce and management markets and marketing meaning, nature and importance of services introduction to services nature and types of services

  1. True

  2. False

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Correct Option: A
Explanation:

Point of order is a type of formal motion that leads to an interruption of the meeting. A member can raise a question on the procedure of the meeting. Point of order by a member thus interrupts the meeting and draws the attention of the Chairman pointing out the irregularities in the proceedings.

State the following statements is True or False:

A person appointed by a member to attend and vote at meeting is known as proxy.

organization of commerce and management markets and marketing meaning, nature and importance of services introduction to services nature and types of services

  1. True

  2. False

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Correct Option: A
Explanation:
According to the Companies Act, any member of a company entitled to attend and vote at a meeting of the company shall be entitled to appoint another person as a proxy to attend and vote at the meeting on his behalf. Provided that a proxy shall not have the right to speak at such meeting and shall not be entitled to vote except on a poll.
The meeting in which the auditors are appointed is the Annual General Meeting.
organization of commerce and management markets and marketing meaning, nature and importance of services introduction to services nature and types of services

  1. True

  2. False

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Correct Option: A
Explanation:

According to Section 139 of the Companies Act, every company shall, at the first annual general meeting, appoint an individual or a firm as an auditor who shall hold office from the conclusion of that meeting till the conclusion of its sixth annual general meeting and thereafter till the conclusion of every sixth meeting. 

The manner and procedure of selection of auditors by the members of the company at such meeting shall be such as may be prescribed.

State the following statement is True or False:

A Director who is entrusted with the substantial powers of management is the Managing Director.

organization of commerce and management markets and marketing meaning, nature and importance of services introduction to services nature and types of services

  1. True

  2. False

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Correct Option: A
Explanation:
Managing director is defined by the Companies Act 2013 as:
'a director who, by virtue of the articles of a company or an agreement with the company or a resolution passed in its general meeting, or by its Board of Directors, is entrusted with substantial powers of management of the affairs of the company and includes a director occupying the position of managing director, by whatever name called'.

The purpose(s) of business that goes beyond earning profits _____________.

organization of commerce and management markets and marketing meaning, nature and importance of services introduction to services nature and types of services

  1. An important institution in society

  2. For the supply of goods and services

  3. Creating job opportunities

  4. All of above

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Correct Option: D
Explanation:

Profit making itself shall not be the purpose of business entities. It is running in an environment where a business entity's responsibilities widen. It contributes to the growth of the society. It supplies the required goods and services thereby catering to the needs of the society. A business entity creates job opportunities for the society. Thus, the purpose of a business entity has to be growth of the society by being a profitable enterprise in itself.