Chapter 16 Multiple choice questions

. Persons who take the procedural steps to set up a company and who make business preparations for the company are known as:

Directors.

Shareholders.

Registrars.

Promoters.

. Joe and Jamel wish to form a new company, which of the following documents must be lodged with the Registrar of Companies?
1. Memorandum of Association.
2. An application for registration.
3. The share certificates
4. The appropriate fee.

1, 2 and 3

1,2, and 4

1,3, and 4

2,3 and 4

. Under the Companies Act 2006 the document that states the subscribers wish to form a company and have agreed to become members of that company is called:

The Company Articles.

The Statement of Compliance.

The Memorandum of Association.

The Company Guarantee.

. What is the internet registry for '.uk' domain names?

Companies House.

Nominet UK.

Dot.com UK.

Internet Registration UK.

. Companies set up under the provisions of the Companies Act 2006 have one major constitutional document called:

The Company Constitution.

The Memorandum of Association.

The Articles of Association.

The Object Clause.

. Will a court permit an alteration of a company's articles to be enforced if the alteration is to give the company the power to expel shareholders?

Yes, there are no restrictions on expelling shareholders.

Yes, provided there is a good reason and it is for the benefit of the company as a whole.

No, the Company's Act 2006 does not permit a shareholder to be expelled from a company.

No, the common law does not permit a shareholder to be expelled from a company.

. Which one of the following statements relating to debentures is incorrect?

Debenture stock is transferable.

A company may not purchase its own debentures.

A debenture holder is a creditor of the company.

A debenture is the written document issued by a company setting out the terms of a loan.

. Which one of the following is not a right of a shareholder?

To receive a dividend declared by the company

To attend and vote a meetings

To receive the company's accounts

To manage company affairs

. Shares issued with special rights attached to them are known as:

Ordinary shares

Preference shares

Rights shares

Debenture shares

. What are redeemable shares?

Shares that cannot be transferred on the stock market.

Shares kept by a company to be sold at a later date.

Shares which when issued carry a right by the company to buy them back.

Shares that carry rights in preference to other shares.

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