State which of the following combination of statements are true about the Company-(A) A company is an artificial person.(B) Capital reserves are created from capital profits.(C) Shareholders of a company are liable for the acts of the company.(D) A company's shares are generally transferable.Choose the correct answer from the options given below:
- A\text{(A), (B) and (D) only}
- B\text{(A), (B) and (C) only}
- C\text{(A), (B), (C) and (D)}
- D\text{(B), (C) and (D) only}
Solution & Step-by-step Explanation
Let's assess the validity of the statements:(A) True: A company is a legal entity created by law, making it an artificial legal person.(B) True: Capital reserves are explicitly funded by capital profits (e.g., premium on shares, profits on reissue).(C) False: A company is a distinct legal entity with limited liability. Shareholders are not personally responsible for the collective legal acts or debts of the company.(D) True: Shares of a public limited company are freely transferable.Hence, statements (A), (B), and (D) are true.