Tag: internal & external stakeholders and distinction between shareholders, stakeholders and customers

Questions Related to internal & external stakeholders and distinction between shareholders, stakeholders and customers

A customer is an individual who receives or purchases a product or service. While a stakeholder is an individual, group, or organization who is affected by the outcome of a product or service.

commercial studies stakeholders in commercial organisation internal & external stakeholders and distinction between shareholders, stakeholders and customers stakeholders final accounts of companies

  1. True

  2. False

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Correct Option: A
Explanation:

A customer is an individual who receives or purchases a product or service. While a stakeholder is an individual, group, or organization who is affected by the outcome of a product or service- this is true. Stakeholder and owners have different purpose.

Directors can be sued by stockholders, if they have __________.

commercial studies stakeholders in commercial organisation internal & external stakeholders and distinction between shareholders, stakeholders and customers stakeholders final accounts of companies

  1. declared unlawful dividends

  2. grossly neglected the interests of stockholders

  3. Either (a) or (b)

  4. None of the above

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Correct Option: C

When a shareholder wants to rematerialize his shares he should write to _____________.

commercial studies stakeholders in commercial organisation internal & external stakeholders and distinction between shareholders, stakeholders and customers stakeholders final accounts of companies

  1. DP

  2. company

  3. registered office of the company

  4. bank where his DP account is

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Correct Option: A
Explanation:

When a shareholder wants to rematerialize his shares he should write to depository participant.In dematerialization of shares depository participant  passes the physical shares to company for making it into electronic form. Depository participant refers to the agent between depository and investors

Generally, a shareholder is a stakeholder of the company while a stakeholder is not necessarily a shareholder.

commercial studies stakeholders in commercial organisation internal & external stakeholders and distinction between shareholders, stakeholders and customers stakeholders final accounts of companies

  1. True

  2. False

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Correct Option: A
Explanation:

Generally, a shareholder is a stakeholder of the company while a stakeholder is not necessarily a shareholder. Stakeholders include employees, managers, officials, customers etc. Stakeholders involve those individuals or organization who are not the owners only.

If authorized by the____________ a company may received from a shareholder the amount remaining unpaid on shares, even though the amount has not been called up which is known as calls-in-advance.

commercial studies stakeholders in commercial organisation internal & external stakeholders and distinction between shareholders, stakeholders and customers stakeholders final accounts of companies

  1. Memorandum of Association (MOA)

  2. Articles of Associtaion (AOA)

  3. Prospectus

  4. Securities Exchange Board of India.

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Correct Option: B
Explanation:
Article of Association(AOA):-
The Articles of Association or AOA are the legal document that along with the memorandum of association serves as the constitution of the company. It is comprised of rules and regulations that govern the company’s internal affairs.
The articles of association are concerned with the internal management of the company and aims at carrying out the objectives as mentioned in the memorandum. These define the company’s purpose and lay out the guidelines of how the task is to be carried out within the organization. 

The articles of association cover the information related to the board of directors, general meetings, voting rights, board proceedings, etc.
The articles of association are the contracts between the shareholders and the organization and among the shareholder themselves. This document often defines the manner in which the shares are to be issued, dividend to be paid, the financial records to be audited and the power to be given to the shareholders with the voting rights.

The articles of association can be considered as the user manual for the organization that comprises of the methodology that can be used to accomplish the company’s day to day operations. This document is a binding on the shareholders and the organization and has nothing to do with the outsiders. Thus, the company is not accountable for any claims made by any external party.

The articles of association is comprised of following provisions:

• Share capital, call of share, forfeiture of share, conversion of share into stock, transfer of shares, share warrant, surrender of shares, etc.
• Directors, their qualifications, appointment, remuneration, powers, and proceedings of the board of directors meetings.
• Voting rights of shareholders, by poll or proxies and proceeding of shareholders general meetings.
• Dividends and reserves, accounts and audits, borrowing powers and winding up.
It is mandatory for the following types of companies to have their own articles:
1. Unlimited Companies: The article must state the number of members with which the company is to be registered along with the amount of share capital, if any.
2. Companies Limited by Guarantee: The article must define the number of members with which the company is to be registered.
3. Private Companies Limited by Shares: The private company having the share capital, then the article must contain the provision that, restricts the right to transfer shares, limit the number of members to 50, prohibits the invitation to the public for the further subscription of shares in the form of shares or debentures.

A shareholders is a _________ of a company.

commercial studies stakeholders in commercial organisation internal & external stakeholders and distinction between shareholders, stakeholders and customers stakeholders final accounts of companies

  1. owner

  2. employee

  3. promoter

  4. none of the above

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Correct Option: A
Explanation:

A shareholders is an owner of a company since they own the shares of stock of a company. They are also known as the members of the corporation.

Which of the following letter is sent to the share holders whenever an amount becomes payable on shares?

commercial studies stakeholders in commercial organisation internal & external stakeholders and distinction between shareholders, stakeholders and customers stakeholders final accounts of companies

  1. Share Application Letter

  2. Share Allotment Letter

  3. Share Call Letter

  4. None of above

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Correct Option: C
Explanation:

Share Call letter is sent to the share holders whenever an amount becomes payable on shares. Whenever an amount is to be paid out on shares, share call letter is the required document which is to be issued to th shareholders.

Receiving dividends is a group right of share holders.

commercial studies stakeholders in commercial organisation internal & external stakeholders and distinction between shareholders, stakeholders and customers stakeholders final accounts of companies

  1. True

  2. False

  3. Partly True

  4. Partly False

Show answer
Correct Option: B
Explanation:

Dividends are the payments made out of distributable profits available to company. In simple terms, it is defined as that portion of profits of the company allocated to the holders of shares in the company. Shareholders do not have an automatic to receive dividend payment and also there is no legal obligation on company to declare dividends unless it is proposed by directors of the company and approved by the shareholders. Once dividend is declared by the company then it is right of shareholders to receive payment, otherwise shareholders can take legal action against the company. Therefore, the statement that receiving dividends is a group right of shareholders is incorrect.

The stakeholders of the company include  ___________.
business studies sources of business finance internal & external stakeholders and distinction between shareholders, stakeholders and customers stakeholders in commercial organisation stakeholders

  1. shareholders

  2. government authorities

  3. employees

  4. All of above

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Correct Option: D
Explanation:
A stakeholder is a person which has an interest in a company that he/she deals with and can either affect or be affected by the business. Thus shareholders, government authorities, employees etc are stakeholders of the company.

Communities and governments are closely tied external stakeholders.

business studies sources of business finance internal & external stakeholders and distinction between shareholders, stakeholders and customers stakeholders in commercial organisation stakeholders

  1. True

  2. False

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Correct Option: A
Explanation:

Communities and governments are closely tied external stakeholders- this is a true statement.External stakeholders belong to the entities outside the business organization. Officials and suppliers are also external stakeholders.