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easyMCQCUET Accountancy 2025 2 June Shift 22026CUET Accountancy
1 mark

Which of the following statements are true with reference to a "company"?(A) The directors of the company are the owners of the company.(B) A company is an artificial person.(C) A company has its common seal.(D) The liability of the members of the company is limited to the extent of shares held by them.Choose the correct answer from the options given below:

  1. A
    (A), (B) and (D) only
  2. B
    (A), (B) and (C) only
  3. C
    (A), (B), (C) and (D)
  4. D
    (B), (C) and (D) only

Solution & Step-by-step Explanation

Let's evaluate the characteristics of a joint-stock company:Statement (A) is false because the shareholders are the owners of the company. The directors are elected representatives responsible for managing the company's operations.Statement (B) is true because a company is created by law and has a separate legal entity, making it an artificial person.Statement (C) is true because a company uses a common seal to act as its official signature.Statement (D) is true because the liability of a company's members is limited to any unpaid amount on the shares they hold.Therefore, statements (B), (C), and (D) are correct.

Practice this question

Try it yourself before checking the explanation above.

Which of the following statements are true with reference to a "company"?(A) The directors of the company are the owners of the company.(B) A company is an artificial person.(C) A company has its common seal.(D) The liability of the members of the company is limited to the extent of shares held by them.Choose the correct answer from the options given below:
A
(A), (B) and (D) only
B
(A), (B) and (C) only
C
(A), (B), (C) and (D)
D
(B), (C) and (D) only

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