1. A company comes into legal existence after issuance of
(A) Certificate of commencement
(B) Memorandum filing
(C) Certificate of incorporation
(D) Prospectus approval
2. The internal rules and regulations of a company are contained in the
(A) Prospectus
(B) Memorandum of Association
(C) Share certificate
(D) Articles of Association
3. The main document defining the scope of a company’s powers is
(A) Articles
(B) Prospectus
(C) Memorandum
(D) Resolution
4. A private company restricts the right to
(A) Transfer shares
(B) Issue debentures
(C) Pay dividends
(D) Borrow loans
5. The minimum number of members required to form a public company is
(A) 1
(B) 7
(C) 3
(D) 2
6. Prospectus is issued by a
(A) Sole trader
(B) Partnership
(C) Public company
(D) Private company
7. A company auditor is appointed by the
(A) Directors
(B) Government
(C) Bank
(D) Shareholders
8. The first auditors of a company are appointed by
(A) Creditors
(B) Registrar
(C) Shareholders
(D) Directors
9. A statutory meeting is required only for
(A) Public companies
(B) Private companies
(C) Government companies
(D) Foreign companies
10. Shares issued at a price above face value are called
(A) Discounted shares
(B) Bonus shares
(C) Premium shares
(D) Rights shares
11. A company director acts as a
(A) Employee
(B) Debtor
(C) Trustee and agent
(D) Arbitrator
12. The minimum number of directors in a public company is
(A) 1
(B) 3
(C) 2
(D) 5
13. Dividends are declared by
(A) Auditors
(B) Registrar
(C) Creditors
(D) Directors
14. A company’s share capital cannot be reduced without
(A) Court approval
(B) Member approval
(C) Registrar approval
(D) Bank approval
15. Debentures represent
(A) Ownership
(B) Profits
(C) Loan capital
(D) Reserve funds
16. The liability of shareholders in a company is
(A) Limited
(B) Unlimited
(C) Joint and several
(D) Absolute
17. Bonus shares are issued to
(A) Creditors
(B) Employees
(C) Registrar
(D) Existing shareholders
18. A special resolution requires at least
(A) Simple majority
(B) 30% majority
(C) 75% majority
(D) 90% majority
19. The first board meeting of a company must be held within
(A) 7 days
(B) 30 days
(C) 10 days
(D) 45 days
20. Winding up of a company may be voluntary or by
(A) Court
(B) Bank
(C) Suppliers
(D) Credit rating agencies
21. A company that cannot pay its debts is said to be
(A) Insolvent
(B) Licensed
(C) Dormant
(D) Incorporated
22. The doctrine of ultra vires refers to acts done
(A) Outside the company's powers
(B) Within authority
(C) Under government pressure
(D) During liquidation
23. A private company must have at least
(A) 1 director
(B) 2 directors
(C) 3 directors
(D) 7 directors
24. Pre-incorporation contracts are
(A) Valid
(B) Void
(C) Voidable
(D) Illegal
25. The paid-up capital is the amount
(A) Subscribed and paid by shareholders
(B) Paid by government
(C) Borrowed from banks
(D) Generated as profit
26. The promoter of a company is liable for
(A) Pre-incorporation contracts
(B) Post-incorporation acts
(C) Auditor’s duties
(D) Director’s salary
27. A certificate of incorporation is
(A) Optional
(B) Tax certificate
(C) Government license
(D) Proof of company formation
28. A company is called an artificial person because
(A) It pays no tax
(B) It is imaginary
(C) It has no physical body
(D) It acts like humans
29. A quorum refers to
(A) Number of shareholders
(B) Total directors
(C) Minimum members required for meeting
(D) Voting rights
30. A proxy can attend
(A) General meetings
(B) Board meetings
(C) Auditor meetings
(D) Internal meetings