Tag: joint hindu family business

Questions Related to joint hindu family business

Head of HUF is known as ______.

organization of commerce and management ownership structures - sole proprietorship and joint hindu family business hindu undivided family business introduction to huf joint hindu family business

  1. karta

  2. coparceners

  3. manager

  4. head

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Correct Option: A
Explanation:

Joint hindu family business is regulated by the Hindu succession act. According to it the business is owned and managed by the karta, the head of the family and  the members of the family are its co parceners. Hence, the head of the family business is  called as karta.

In case of HUF what are liabilities of coparcener and Karta?

organization of commerce and management ownership structures - sole proprietorship and joint hindu family business hindu undivided family business introduction to huf joint hindu family business

  1. Both have unlimited liability

  2. Coparcener's liability is limited while Karta's liability is unlimited

  3. Karta's liability is limited while Coparcener's liability is unlimited

  4. Both have limited liability

Show answer
Correct Option: B
Explanation:

Joint Hindu family business is regulated by the Hindu succession act. According to it the business is owned and managed by the karta, the head of the family and the members of the family are its co parceners. Hence, the head of the family business is  called as karta. The liability of coparcener is limited whereas the liability of karta is unlimited.

When partnership is between two HUF than ____________.

organization of commerce and management ownership structures - sole proprietorship and joint hindu family business hindu undivided family business introduction to huf joint hindu family business

  1. members of both the HUF are taken in account for the calculation of maximum number of person who can form a partnership firm including minors

  2. members of both the HUF are taken in account for the calculation of maximum number of person who can form a partnership firm excluding minors

  3. there can not be a partnership between two HUF

  4. none of the above

Show answer
Correct Option: B

Identify which statement is true and which is false?
1. Any person can become member of HUF.
2. In a HUF business, in the event of death of any of the co-parcener, his wife can claim share of profit.
3. In a HUF business, the liability of the karta is Unlimited.
Select the correct answer from the options given below.

organization of commerce and management ownership structures - sole proprietorship and joint hindu family business hindu undivided family business introduction to huf joint hindu family business

  1. 2 and 3

  2. 1 and 3

  3. 3 and 2

  4. None of the above

Show answer
Correct Option: A
Explanation:

The statement fore mentioned are discussed below:

1. False. As per the Hindu Law all persons lineally descended from a common ancestor are members of a HUF.
2. True. In a HUF business in the event of death of any of the co-parcener , his wife can claim share of profit.
3. True. In a HUF busines the liability of the karta is unlimited.

Which of the following can be treated as disadvantage of HUF form of business?

organization of commerce and management ownership structures - sole proprietorship and joint hindu family business hindu undivided family business introduction to huf joint hindu family business

  1. HUF business has generally limited financial and managerial resource.

  2. There is always a lack of motivation among the members to work hard.

  3. Since the karta has absolute freedom to manage the business, there is scope for him to misuse it for his personal gains.

  4. All of above

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Correct Option: D

Profit sharing among members in an HUF is done according to _______.

organization of commerce and management ownership structures - sole proprietorship and joint hindu family business hindu undivided family business introduction to huf joint hindu family business

  1. members status in family

  2. amount of work done by a member

  3. equally

  4. according to the age of the member

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Correct Option: C

The members of an HUF are also known as _______.

organization of commerce and management ownership structures - sole proprietorship and joint hindu family business hindu undivided family business introduction to huf joint hindu family business

  1. family

  2. partners

  3. co-parceners

  4. none of the above

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Correct Option: C

The liability of the karta is __________.

organization of commerce and management ownership structures - sole proprietorship and joint hindu family business hindu undivided family business introduction to huf joint hindu family business

  1. Llmited

  2. unlimited

  3. not liable

  4. none of the above

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Correct Option: B

The business affairs of an HUF is managed by _______.

organization of commerce and management ownership structures - sole proprietorship and joint hindu family business hindu undivided family business introduction to huf joint hindu family business

  1. managing director

  2. parents of minors

  3. karta

  4. eldest male and female member of the family

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Correct Option: C

An HUF continues to exist even upon the death of the Karta.

organization of commerce and management ownership structures - sole proprietorship and joint hindu family business hindu undivided family business introduction to huf joint hindu family business

  1. Partly false

  2. False

  3. Partly true

  4. True

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Correct Option: D