class 11 business studies chapter 7 case study questions

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Class 11 Business Studies Case Study Questions

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For students appearing for grade 11 CBSE exams from the Commerce stream, Business Studies is a fundamental subject. Business Studies is considered to be quite interesting as well as an occupying subject as compared to all other core subjects of the CBSE class 11 commerce stream. To ace this CBSE exam, students are not only required to work hard but they ought to learn to do smart work too.

Among all the other core subjects of the Commerce stream i.e accountancy, economics and business studies, Business Studies is the one that is purely theoretical. It is termed to be comparatively easier and more scoring than the other mandatory subjects of the commerce stream. Many students who opt for the commerce stream after their 10-grade exams desire to learn in-depth about the business organizations and their work, for them the subject is of utmost importance. Business Studies is an essential component of the class 11 commerce stream curriculum.

In order to ace the subject the student needs to have conceptual clarity. CBSE has designed the syllabus for class 11 Business Studies so as to provide students with a basic understanding of the various principles prevalent in the Business organizations as well as their interaction with their corresponding environment.   

Case Study Questions in class 11 (Business Studies)

Case-based questions have always been an integral part of the Business Studies question paper for many years in the past. The case studies have always been considered to be challenging for the students, for such questions demand the application of their knowledge of the fundamental business concepts and principles. Last year i.e-  2021 CBSE introduced a few changes in the Business Studies question paper pattern to enhance and develop analytical and reasoning skills among students.

It was decided that the questions would be based on real-life scenarios encountered by the students.CBSE not only changed the way case-based questions were formulated but also incremented their weightage in the Business Studies question paper. The sole purpose of increasing the weightage of case-based questions in the class 11 curriculum by CBSE was to drift from rote learning to competency and situation-based learning.

What is a case study question? (Business Studies)

In Business Studies, a case study is more like a real-world test of how the implementation works. It is majorly a report of an organization’s implementation of anything, such as a practice,a product, a system, or a service. The questions would be based on the NCERT textbook for class 11 Business Studies. Case-based questions will definitely carry a substantial weightage in the class 11 Business Studies question paper. questions.

A hypothetical text will be provided on the basis of which the student is expected to solve the given case-based question asked in the Business Studies class 11 exam. Initially, the newly introduced case-based questions appeared to be confusing for both the students and the teachers. Perhaps, they were reluctant to experiment with something new but now a lot more clarity is there that has made the question paper quite student-friendly.

Case study questions could be based on any chapter or concept present in the NCERT textbook. Thus, it is expected from the students to thoroughly revise and memorize the key business fundamentals. 

Business Studies syllabus of class 11 CBSE   

The entire Business Studies course is divided into 2 parts:

• Part A, Foundation of Business
• Part B, Finance and Trade

The class 11 Business Studies exam is for a total of 100 marks, 80 marks are for the theory and the remaining 20 for the project. Most of the questions are based on the exercises from the NCERT textbook. It is recommended to rigorously go through the contents of the book. A single textbook has been published by NCERT for Class 11 Business studies. There are a total of 10 chapters in this book divided into 2 parts. 

CBSE Class – 11

Business Studies (Code No. 054)

Theory: 80 Marks Time: 3 Hours Project: 20 Marks

Case Study Passage (Business Studies class)

As part of these questions, the students would be provided with a hypothetical situation or text, based on which analytical questions will have to be answered by them. It is a must for the students to read the passage in depth before attempting the questions. In the coming examination cycle (2022-23), case-based questions have a weightage of around 30%. These questions can be based on each chapter in the NCERT book for Business Studies, grade 11.

Students must prepare well for the case-based questions before appearing for their Business Studies exam as these questions demand complete knowledge of the various concepts in their syllabus. CBSE plans to increase the weightage of such questions in the upcoming years.

Sample case-based Questions in Business Studies

Business Studies as a subject provides a way of perceiving and interacting with the business ecosystem. It is a core subject of the commerce stream that is purely theoretical and relevantly easier than the other compulsory subjects of the stream. Class 11 Business Studies syllabus is closely related to trade and commerce. The subject cannot be ignored as it is the foundation of many concepts and theories which are studied at an advanced level in class 12.

The case-based questions asked in the CBSE Business Studies question paper for class 11 are of two types:

As per the latest circular issued by CBSE on Assessment and Evaluation practices of the board for the session 2022-23, CBSE has clearly mentioned that competency-based questions including case studies will be different from subjective questions.  

The questions can also be categorized on their difficulty level:

• Direct: such questions can be easily solved. Their answer is visible in the given passage itself.
• Indirect/ Analytical: such questions are confusing and tricky. These can be solved by the application of the theory or principle that is highlighted in the provided text. 

How To Prepare For Case-based Questions? (Business Studies grade 11)

Students need to prepare well for the case-based questions before appearing for their class 11 Business Studies exam. Here are some tips which will help the student to solve the case-based questions at ease:

• Read the provided text carefully
• Try to comprehend the situation and focus on the question asked
• Analyze and carefully answer the question asked
• In general, the passage given would be lengthy in Business Studies case-based questions but their solutions are comparatively short and simple
• One can significantly save time if they follow a reversal pattern, that is going through the questions before reading the comprehensive case study passage.
• Answer in a concise manner
• One should concentrate on solidifying key fundamental principles/theories
• Go through the NCERT textbook in depth. The language used is crisp and simple.
• While providing solutions to the case-based question, pick the keyword/keyline based on which you are driving insights.

 In order to excel in the Business Studies class 11 exam, one needs to ignore the shortcut techniques and get to read the NCERT textbook rigorously. Case studies can be easily solved if your key fundamentals are strong and clear. The best part of having these questions is that the asked question itself projects a hint of its answer. These simple points if kept in mind will definitely help the students to fetch good marks in case study questions, class 11 Business Studies. 

Case study question examples in Business Studies

Here a re some given case study questions for CBSE class 11 Business Studies. If you wish to get more case study questions and other study material, download the myCBSEguide app now. You can also access it through our student dashboard.

Business Studies Case Study 1

Read the hypothetical text given and answer the following questions:

Manish, Rahul and Madhav live in the same locality. They used to meet and discuss their ideas. After discussing the recent fire breakout in their area, they decided to take fire insurance for their house or work area. Manish gets his house insured against fire for ₹1 lakh and during the policy period, his house gets damaged due to fire and the actual loss amounts to ₹2.5 lakh. The insurance company acquired the burning material and approved his claim. Rahul gets his godown insured against fire for ₹1 lakh but does not take enough precautions to minimize the chances of fire like installing fire extinguishers in the factory. During the policy, a fire takes place in his godown and he does not take any preventive steps like throwing water and calling the employees from the fire fighting department to control the fire. He suffered a loss of ₹1,20,000. Madhav took a fire insurance policy of ₹20 lakh for his factory at an annual payment of ₹24,000. In order to reduce the annual premium, he did not disclose that highly explosive chemicals are being manufactured in his factory. Due to a fire, his factory gets severely damaged. The insurance company refused to make payment for the claim as it became aware of the highly explosive chemicals.

How much can Manish claim from the insurance company?

• None of the above

How much compensation can Rahul get from the insurance company?

Which principle is violated in the case of Rahul?

• Insurable Interest
• Utmost Good Faith

How much amount is the insurance company liable to pay to Madhav if he files a case against it?

• Insufficient information

Which principle of Insurance is violated by Madhav?

• Insurable interest
• Subrogation
• Proximate Cause

The insurance company acquired the burnt material and approved his claim. Which principle of Insurance is highlighted in the given statement.

• (a) Mitigation
• (a) Utmost Good Faith
• (d) Subrogation

Business Studies Case Study 2

 Sarthak Electronics Ltd. has a loss of Rs 15,00,000 to pay. They are short of funds so they are trying to find means to arrange funds. Their manager suggested a claim from the insurance company against stock lost due to fire in the warehouse. He actually meant that they can put their warehouse on fire and claim from insurance companies against stock insured. They will use the claim money to pay the loan.

• Will the company receive a claim if the surveyor from the insurance company comes to know the real cause of fire?
• Write any two Values which the company ignores while planning to arrange money from false claims.
• State any three elements of fire insurance

Business Studies Case Study 3

OLX and qickr are examples of well-known websites used to conduct business. Tarasha’s sofa set got spoiled in the rain. Her friend suggested that she should change the fabric so that it looks new and put it for sale on Olx. Tarasha followed her friend’s advice and got her sofa repaired so that it looked better and uploaded nicely clicked pictures on the website without disclosing the fact that it was damaged from the inside. She found a buyer and sold it for Rs 10,000. After five days the buyer found the real state of the sofa set and called Tarasha but she did not answer any of the calls.

• identify the type of business highlighted in the above case.
• Identify any two values which are overlooked by Tarasha.
• Explain any two benefits and limitations of e-business.

Advantages of case study questions in Business Studies

Class 11 Business Studies syllabus is not very vast but has to be focussed upon as it forms the base for your 12th grade Business Studies syllabus. Students are supposed to prepare themselves thoroughly from the NCERT textbook. The Case-based questions prominently focus on the real and current scenarios of the Business world. Approximately 30% of the question paper will comprise case study questions that demand high-order thinking and reasoning skills from the students. The students ought to practice class 11 Business Studies case-based questions from the various options available to them, so as to excel in the subject.

• Enhance the qualitative and quantitative analysis skills of students
• Provides an in-depth understanding of the key Business theories/concepts
• Inculcate intellectual capabilities in students
• Help students retain knowledge for a longer period of time
• The questions would help to discard the concept of rote learning
• Case studies promote and strengthen practical learning.

“Failure is success if you learn from it”

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NCERT Solutions For Class 11 Business Studies Chapter 7 Formation Of A Company

Class 11 business studies chapter 7 formation of a company.

NCERT Solutions For Class 11 Business Studies Chapter 7 Formation Of A Company, (Business Studies) exam are Students are taught thru NCERT books in some of state board and CBSE Schools.  As the chapter involves an end, there is an exercise provided to assist students prepare for evaluation.  Students need to clear up those exercises very well because the questions withinside the very last asked from those. 

Sometimes, students get stuck withinside the exercises and are not able to clear up all of the questions.  To assist students solve all of the questions and maintain their studies with out a doubt, we have provided step by step NCERT  Solutions for the students for all classes.  These answers will similarly help students in scoring better marks with the assist of properly illustrated Solutions as a way to similarly assist the students and answering the questions right.

Short Questions Answers

1. Name the stages in the formation of a company.

Following stages are there:

1. Promotion: This step deals with idea generation and implementing it as a company.

2. Incorporation: This stage consists of applying for the certificate of incorporation and obtaining the same, after the certificate is received a company becomes a valid entity in the books of law.

3. Issuing of shares and debentures: This stage involves raising capital in the form of issuing stocks and debentures to the public.

4. Business commencement: In this stage the formalities are completed and company commences business.

2. List the documents required for the incorporation of a company.

Following documents are required to be submitted:

1. MoA or Memorandum of Association

2. AoA or Article of Association

3. Director’s approval confirming that they will be functioning as director and buy qualification shares.

4. An agreement, with the managing director or someone who is going to be given the post of director.

5. A letter from registrar containing approving the name of the company.

6. A statutory declaration stating that all legal registration requirements have been complied

7. A notice stating the exact address of office (it can also be submitted within 30 days of being incorporated)

8. Payment evidence of registration fees in the form of a document.

3. What is a prospectus? Is it necessary for every company to file a prospectus?

A prospectus is an invitation from a company to the general public informing about availability to purchase or subscribe shares and debentures issued by the company. IPO also known as Initial Public Offering and is a source of raising of funds from the public. But, in case of a private company, there is no need to file a prospectus as private companies are restricted from issuing IPO. A prospectus can be required if the aim is to generate funds from public. Private companies are not required to file a prospectus.

4. Briefly explain the term ‘Return of Allotment’.

A statement submitted to the Registrar containing names and address of shareholders with the number of shares that are allotted to each of them is called as Return of Allotment. It needs to be signed by the director or a secretary within 30 days of the allotment. It shows that the company has received the minimum necessary subscription.

5. At which stage in the formation of a company does it interact with SEBI?

The stage of capital subscription is that stage where a company needs to interact with Securities and Exchange Board of India (SEBI). The interaction is required because during this phase the company looks to raise capital from public by issuing shares and debentures. For issuing such shares the company has to follow rules set by SEBI, so it becomes essential to obtain approval from SEBI before issuing of shares or moving ahead with capital subscription.

Long Questions Answers

1. What is meant by the term ‘Promotion’? Discuss the legal position of promoters with respect to a company promoted by them.

The process of conceiving or developing an idea of business and taking the initial step towards converting it into a company so that the idea can be converted into a business project is called as promotion and the people who take those initial steps are known as promoters of the company.

A promoter, apart from developing the business idea also needs to analyse the prospects in future and take necessary steps to fulfil the purpose. The promoter needs to arrange labour, machinery and capital. So here are some of the legal liabilities that a promoter has towards the company:

1. A promoter is neither an agent nor a trustee of the company as prior to getting incorporated a company does not exist as a legal entity.

2. Promoters cannot make secret profits by making deals acting on behalf of the organisation or company.

3. The promoters can be held legally liable for any untrue statement that will be filed in the company prospectus.

4. Expenses incurred by promoters during the promotion of the company cannot be claimed.

5. The promoters are not may or may not be considered for payments before a company gets incorporated. Based on company’s discretion they may be allotted shares to compensate for their exemplary services.

2. Explain the steps taken by promoters in the promotion of a company.

A promoter is that person who takes up the initiative of forming a company based on the business idea and takes the necessary steps to ensure the purpose is met. A promoter has the do the following things for promoting the company:

1. Identifying the business opportunity: The first step for a promoter is to identify a business opportunity and then analysing whether it is worth investing in.

2. Checking the feasibility of the idea: The idea that came to mind might not be feasible enough so that it can be translated into a business. For this some detailed study should be done and for this following types of checks should be done:

i. Technical feasibility: In some ideas the technical feasibility may be less, the reason for such can be the technology or the kind of raw material required for executing the project is not easily available. So this part needs to be taken care of.

ii. Financial Feasibility: All the business require initial capital to get started and sustain in the market. Also the promoters need to determine the cost that need to be beared for implementing the idea. Therefore, if there is fund crunch and the project cost is humongous. Plan needs to be changed.

iii. Economic feasibility: In some case the probability of success can be very low in spite of all other factors working in favour, that part also needs to be considered.

3. Choosing company name: As soon as a decision to establish a company is taken, the promoters select a name for it. For getting the approval of the proposed name, application needs to be submitted to registrar of companies of the state. The application should contain three names in order of preference as the possibility of similar name may exist.

4. Choosing members to sign MoA: A promoter needs to choose members who will sign the Memorandum of Association (MoA) and will become the directors of company.

5. Selecting professionals: The promoters should hire professionals who will be preparing the necessary documents for the company, these professionals can be bankers, solicitors, brokers and underwriters.

6. Getting documents ready: After all professionals are appointed, the promoter submits all the prepared documents to the registrar of companies.

3. What is a ‘Memorandum of Association’? Briefly explain its clauses.

One of the most essential document in the formation of a company is Memorandum of Association or MoA. It shows the main objectives of the company and its goals in the long term.

The MoA regulates the incorporated company activities such that it can undertake activities that are mentioned in MoA. The number of persons signing the form varies as per the type of company (seven in case of public company while two members for private). The main clauses of MoA can be as follows

1. Name: It should include the name of the company that has been approved by registrar of companies.

2. Registered Office: The clause mentions address and name of company in which it is situated. Name giving is not mandatory, but it is essential to submit company name within 30 days of its incorporation.

3. Objects clause: Most important clause while filling MoA is it defines the objectives for which a company is raised. Any activity cannot be undertaken that are not stated in objects clause. There are two types of object clause namely, main objects and other objects.

4. Liability clause: This clause is all about liability of each shareholder as per amount invested by them or the shares they own.

5. Capital Clause: It refers to the clause of raising authorised capital by issuing of shares

6. Association clause: It contains the statement by those who sign the MoA and who accept MoA and also the consent of buying qualification shares.

4. Distinguish between ‘Memorandum of Association’ and ‘Articles of Association’.

5. What is the meaning of Certificate of Incorporation?

A company becomes a legal entity by the date printed on Certificate of Incorporation. A company can go into valid contracts after the conclusiveness of certificate of incorporation. It acts as an evidence of legal existence of a company and regularity of the incorporation.

A company becomes a legal entity once certificate of Incorporation is issued. A private company can immediately start business and raise funds from relatives, friends or through some arrangement and can start business, while a public company has to undergo two more steps to complete its formation.

6. Discuss the stages of formation of a company.

The following stages are there in the formation of a company:

1. Promotion: This step deals with idea generation and implementing it in the form of a company.

4. Business commencement: In this stage the formalities are completed and business are commenced by the company.

Benefits of NCERT Solutions

NCERT’s Class 11 solution contains extremely important points, and for each chapter, each concept has been simplified to make it easier to remember and increase your chances of achieving excellent exam results. Exam Preparation References Here are some tips on how these solutions can help you prepare for the exam.

• This helps students solve many of the problems in each chapter and encourages them to make their concepts more meaningful.
• NCERT Solutions for Class 11 solutions encourage you to update your knowledge and refine your concepts so that you can get good results in the exam.
• These solutions are the best exam materials, allowing you to learn more about your week and your strengths. To get good results in the exam, it is important to overcome your weaknesses.
• Most of the questions in the exam are formulated in a similar way to NCERT textbooks. Therefore, students should review the solutions in each chapter in order to better understand the topic.
• It is free of cost.

Tips & Strategies for Class 11 Exam Preparation

• Plan your course and syllabus and make time for revision
• Please refer to the NCERT solution available on the  cbsestudyguru  website to clarify your concepts every time you prepare for the exam.
• Use the  cbsestudyguru  learning app to start learning to successfully pass the exam. Provide complete teaching materials, including resolved and unresolved tasks.
• It is important to clear all your doubts before the exam with your teachers or Alex (an Al study Bot). 
• When you read or study a chapter, write down algorithm formulas, theorems, etc., and review them quickly before the exam.
• Practice an ample number of question papers to make your concepts stronger. 
• Take rest and a proper meal.  Don’t stress too much. 

Why opt for cbsestudyguru NCERT Solutions for Class 11 ? 

• cbsestudyguru  provide NCERT Solutions for all subjects at your fingertips.
• These solutions are designed by subject matter experts and provide solutions to every NCERT textbook questions. 
• cbsestudyguru  especially focuses on making learning interactive, effective and for all classes.
• We provide free NCERT Solutions for class 11 and all other classes.

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NCERT Solutions for Class 11 Business Studies Chapter 7

NCERT Solutions for Class 11 Business Studies Chapter 7 Formation of a Company. Download study material related to chapter 7 in Hindi and English Medium. The separate PDF files for Hindi and English Medium are given below to free download. Answers of long questions and short questions with true false are available to use online only. All the contents on Tiwari Academy is free to use.

11th B St Chapter 7 True/False Answer Questions

It is necessary to get every company incorporated, whether private or public..

The statement is True.

Statement in lieu of prospectus can be filed by a public company going for a public issue.

The statement is False.

A company can commence business after incorporation.

Expert who help promoters in the promotion of a company are also called promoters., a company can ratify preliminary contracts after incorporation., if a company is registered on the basis of fictitious names, its incorporation is invalid., “articles of association” is the main document of a company., every company must file articles of association., if a company suffers heavy losses and its assets are not enough to pay off its liabilities, the balance can be recovered from the private assets of its members., 11th b st chapter 7 short answer questions, name the stages in the formation of a company..

The formation of a company involves the following steps: (a) Promotion: Taking the initiative to form a company and promoting it. (b) Incorporation: Formation of the company as a separate legal entity. (c) Subscription of capital: Raising funds in the form of shares and debentures. (d) Commencement of business: Completion of the legal formalities and the commencement of business by the company.

List the documents required for the incorporation of a company.

The documents required for the incorporation of a company are: (a) Memorandum of Association duly stamped, signed and witnessed. (b) Articles of association. (c) Written approval of the proposed directors to function as directors and an undertaking to buy the qualification shares. (d) An agreement naming the proposed managing director or a manager or a full-time director, if any. (e) A copy of the letter obtained from the registrar concerned approving the company name proposed. (f) A legal confirmation by the law stating the submission of all documents and requirements for registration. (g) The exact address of the registered office. (h) Documentary evidence of payment of the registration fee.

What is a prospectus? Is it necessary for every company to file a prospectus?

A company’s prospectus is a formal legal document designed to provide information and full details about an investment offering for sale to the public. Companies are required to file the documents with the Securities and Exchange Commission. It is a sort of advertisement or an invitation, also known as initial public offering (IPO), from a company to the general public to subscribe or purchase shares or debentures issued by the company. The company can raise the funds it requires for an investment project. In case of a private company, it is not mandatory to file a prospectus because of the restrictions placed on raising funds from public.

Briefly explain the term “Return of Allotment”.

Return of Allotment is a statement submitted to the Registrar which contains the names and addresses of shareholders and the number of shares allotted to each shareholder. Return of allotment, signed by a director or secretary is filed with the Registrar of Companies within 30 days of allotment. It is not required to be filed when there is a reissue of surrendered shares or Reissue of forfeiture of shares.

At which stage in the formation of a company does it interact with SEBI?

A company interacts with the Securities and Exchange Board of India (SEBI) at the third stage of formation, the stage of capital subscription. At this stage the company needs to raise funds from the general public by offering shares and debentures for subscription. The company is required to follow the prescribed rules and guidelines issued by SEBI in order to protect the investors’ interests. Therefore, it becomes necessary for the company to get SEBI’s approval before proceeding with capital subscription.

11th B St Chapter 7 Long Answer Questions

What is meant by the term “promotion” discuss the legal position of promoters with respect to a company promoted by them..

Promotion refers to the entire process by which a company is brought into existence. It starts with the conceptualisation of the birth a company and determination of the purpose for which it is to be formed. The persons who conceive the company and invest the initial funds are known as the promoters of the company. A promoter is one who takes the initiative to form a company with reference to a given idea or project and takes the steps necessary to fulfil this purpose. Promotion is the very first stage in the process of formation of a company. It starts with the idea about a business being converted into a successful business opportunity. The following are the legal liabilities of the promoters towards the company: (i) The promoters are neither the trustees nor the agents of the company that they are forming. This is because the company does not exist as a legal entity before its incorporation. (ii) They are not authorized to make any secret profits by making deals on behalf of the company. (iii) They are legally liable for any false or untrue statement filed in the prospectus of the company. (iv) The expenses incurred by them cannot be claimed as expenses. (v) The company may or may not indemnify the promoters for the payments made before its incorporation. The company may choose to allot shares to them in order to compensate for their services.

Explain the steps taken by promoters in the promotion of a company.

A corporate promoter is a firm or person who does the preliminary work incidental to the formation of a company, including its promotion, incorporation, and flotation, and solicits people to invest money in the company, usually when it is being formed. A promoter takes the initiative to form a company with an idea or a project and also takes the steps necessary to form a company. The following steps are taken by the promoters for the promotion of the company: (i) Generating a business idea : Initially, a promoter discovers the idea for the formation of a company with a business idea in his mind and goes on to seek a suitable business opportunity. (ii) Feasibility check : Sometimes a business idea may or may not be feasible enough to be converted into a successful business, therefore all pro’s and con’s are taken into consideration. All feasibility aspects are studied in detail with the help of charted accountants, engineers, accountant, etc; to check if the business taken up is worth it depending on its nature. In this regard, the following studies are made (a) Technical feasibility: Sometimes the idea may be good enough but not technically feasible. Technical feasibility refers to the technological aspect of a business where technology or raw material required to execute the project is not easily accessible. (b) Financial feasibility: Setup of a business requires capital to start it operations. The promoters have to assess the cost of implementing the idea. Organisations need to assess the capital required and sources of finance available. In case the cost of the project is huge and the project isn’t feasible financially, then the idea may have to be dropped. (c) Economic feasibility: In some cases, the project may be technically and financially feasible but the probability of its success may be very low. In such cases, too, the idea will have to be given up. (iii) Selecting the company’s name : Once all feasibility tests are done and a green signal for company is obtained, the promoters need to select a suitable name for it. An application is submitted to the registrar of companies for the approval of name. This application must contain at least three names in the order of their preference. Sometimes, the name may not be approved or may be inappropriate, therefore a company must submit at least three names out of which most appropriate one will be approved. (iv) Signing the memorandum of association (MoA) : The promoters are required to select the members for signing the MoA. In this regard, the members who generally sign the MoA become the first directors of the company. (v) Appointing professionals : The promoters are required to appoint professionals such as bankers, brokers, solicitors and underwriters for preparing the documents necessary for the company. The details of the number of shares allotted to each shareholder, along with his or her addresses for correspondence, are submitted to the registrar. (vi) Preparing all the documents necessary : After the appointment of professionals, the promoters are required to submit the legal documents necessary such as the MoA, articles of association and consent of directors to the registrar of companies.

What is “Memorandum of Association”? Briefly explain its clauses.

A Memorandum of Association (MoA) is a legal document prepared in the formation and registration process of a limited liability company to define its relationship with shareholders. The MoA is accessible to the public and describes the company’s name, physical address of registered office, names of shareholders and the distribution of shares. The MoA and the Articles of Association serve as the constitution of the company. A memorandum of association (MoA) is the most essential document in the formation of a company as it highlights the company’s main objectives and goals. This document must be signed by at least seven members in the case of a public company and by two persons in the case of a private company. The following are the main clauses of the MoA:

• The name clause : This includes the name of the company which has already been approved by the registrar of companies. It is the name by which the company will be known.
• Registered :office clause: This clause mentions the name of the state where the registered office of the company is situated. It is not mandatory to submit the exact address of the registered office at this stage. However, the address needs to be submitted within 30 days of incorporation of the company.
• Objects clause : This is the most important clause in the MoA as it defines the main objective of the company for which it was formed. The company cannot undertake activities that are not stated in the objects clause. The objects clause is divided into the following two sub-clauses. (i) The main objects: This sub-clause lists the main objects for which the company is formed. Any clause that is essential for the achievement of the main objectives is considered valid even if it is not contained in the sub-clause. (ii) Other objects: Objects that are not included in the main-objects clause can be included in this sub-clause. If a company wants to initiate a business activity that is mentioned in this clause, it is required to pass either an ordinary resolution or a special resolution to get the consent of the central government.
• Liability clause : This clause states the liability of each shareholder according to the amount unpaid by them for the shares they own.
• Capital clause : This clause defines the authorised capital of the company which it can raise through the issue of shares. It also states the division of the number of shares.
• Association clause : This clause contains the statement by the signatories to the MoA giving their approval to be a part of the company. They also give their consent to buy the qualification shares of the company.

What is the meaning of Certificate of Incorporation?

A certificate of incorporation is a legal document/license relating to the formation of a company or corporation. It is a license to form a corporation issued by state government or, in some jurisdictions, by non-governmental entity/corporation. A company legally comes into existence or becomes a separate legal entity on the date stated in its certificate of incorporation. The certificate of incorporation acts as an evidence of regularity of the incorporation of the company even if there is any flaw in its registration process. The operations of a company can immediately commence once its certificate of incorporation is issued.

Discuss the stages of formation of a company.

The following are stages of formation of a company:

• Promotion of the company: Promotion refers to the entire process by which a company is brought into existence. It starts with the conceptualisation of the birth a company and determination of the purpose for which it is to be formed. The persons who conceive the company and invest the initial funds are known as the promoters of the company.
• Incorporation of the company: The stage of incorporation consists of applying for and obtaining the certificate of incorporation after which the company becomes a spate legal entity.
• Subscription of capital: Capital Subscription is done in the form of shares and debentures when a company raises funds from general public. An invitation or prospectus is issued, inviting people to subscribe shares of the company.
• Business commencement: After all the basic formalities necessary for incorporation are completed the company can commence the business operations.

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• Important Questions for CBSE Class 11 Business Studies (2024-25)

CBSE Class 11 Business Studies Important Questions - Free PDF Download

Class 11 is the introduction of higher secondary education for the students. For commerce students, business study is an essential subject. They should read this subject sincerely for better higher education. Class 11 business studies syllabus contains vital topics. The students should read the syllabus including important questions for class 11 business studies. The chapter wise important questions are essential exam preparation tools, which will help in scoring good marks. In Class 11 , students are introduced to the commerce subjects, which they will have to study in their higher academic life.

Class 11 Business Studies comprises eleven chapters that cover important topics. These topics need the highest attention from the students to prepare. To assess their preparation level, they can download and solve the Class 11 Business Studies term 2 Important Questions with Solutions developed by the subject experts of Vedantu. Find the solutions to these questions and take a step ahead in your preparation.

CBSE Class 11 Business Studies Chapter-wise Important Questions 2024-25

Chapterwise Important Questions for CBSE Class 11 Business Studies

Class 11 Business Studies Syllabus

Central Board of Secondary Education (CBSE) has included business studies as a vital subject in the class 11 commerce curriculum. The syllabus of business studies includes introductory chapters of some vital topics. The students will get primary knowledge about some vital topics of business studies. The entire syllabus of business studies is divided into part A and part B. Part A is about business foundation knowledge, which contains 6 different units. Part B is about trading and financial knowledge contains 4 units. Each part of the syllabus carries equal division for the exam. The students should read both parts with equal sincerity. They should learn all the topics thoroughly for future convenience and good marks in the final exam. To score well in the exam, they should practice class 11 business studies important questions after completing the entire syllabus.

Class 11 Business Studies Part A

The first part of class 11 business studies includes 6 units about the foundation of the business. The units of part A are Business Evolution and Fundamentals, Different forms of Business Organizations, private, public and multinational business companies, service of business, Business emerging Modes, Business Ethics and Social Responsibility in Business. Here, we have discussed the units briefly.

1. Unit 1: Business Evolution And Fundamentals

The first unit has 8 chapters, which are commerce and trading history of India, definition, and characteristic of business, Profession and Employment concept of Business, Business Objective, Business Activity classification (commerce and industry), Industry Types in Business, the meaning of commerce-trade, Risk concept of Business. All these chapters are important for knowing the subject primarily.

2. Unit 2: Different Forms of Business Organizations

This unit contains 6 chapters about business organization. The chapters are the concept of a sole proprietorship, the concept of partnership, the concept of partnership, the concept of Hindu Undivided Family Business, concept of cooperative society, concept, and classification of company, stages of company Formation.

3. Unit 3: Private, Public, and Multinational Business Companies

The third unit of part business studies class 11 has two chapters. The chapters are the concept and difference of private and public sector, different forms of the public sector. This unit gives an idea of business sector types to the students.

4. Unit 4: Service of Business

This unit includes 3 different chapters about business services. The chapters of this unit are concepts of banking and account types, different forms of banking services and payments, concept and classification of Insurance. All these chapters include primary knowledge of different business services.

5. Unit 5: Business Emerging Modes

This unit has only one chapter about business emerging modes, which is E-business. In this chapter, the concept, features, benefits, and scopes of E-business are described in detail. The students should read this chapter as a vital topic for better knowledge of business studies.

6. Unit 6: Business Ethics And Social Responsibility In Business

The last unit of part A class 11 business studies includes 4 chapters. The chapters are the concept of social responsibility, case of social responsibility, different forms of business responsibility, the role of business in environment protection. The chapters of this unit inform about the ethics and responsibilities of business.

Class 11 Business Studies Part B

The second part of the class 11 business studies syllabus is about trading and financial knowledge business. This part contains four units about trading and financial knowledge. The units are Financial Source of Business, Enterprise, and small business, Internal trading, International Trading. All the units have many chapters. Here, we have discussed the units in a brief.

1. Unit 7: Financial Source of Business

The first unit of class 11 business studies part B has three chapters. The chapters are the concept of Finance in business, the concept of different business materials: owners’ funds, shares, receipts, the concept of borrowed funds. All three chapters give a rough idea of the financial sources and factors of the business.

2. Unit 8: Enterprise and Small Business

This unit has four different chapters about enterprise and small business. The chapters are concept and features of enterprise, classification of enterprise, the role of small business in India, Government schemes for enterprise and small business. The students should read these chapters for deep knowledge in business studies.

3. Unit 9: Internal Trading

This unit includes two chapters, which are the concept of internal trade and the concept of large-scale retailers. The first chapter defines the meaning and features of internal trading. In the second chapter, the students will learn about different stores on a large scale.

4. Unit 10: International Trading

The last unit of class 11 business studies part B has two chapters. In the first chapter, the students will learn the concept, features, and benefits of International Trading. The second chapter is the Definition and Objectives of the World Trade Organization (WTO). Both chapters are important for advancing knowledge in business studies.

Business Studies Class 11 Important Questions Chapter Wise

Class 11 business studies syllabus includes a huge number of chapters separated into different units. The students have to read all the chapters thoroughly to learn the topics correctly. They have to complete the entire syllabus and revise them within an academic year. That is why chapter wise important questions for class 11 business studies during revision. From the chapter wise important questions for class 11 business studies during revision. From the chapter wise important questions, the students will get a chapter insight as well as the question pattern. The chapter wise important questions will make the revision and exam preparation easier. Important questions for class 11 business studies are vital exam preparation tools.

Benefits of Important Questions for Class 11 Business Studies

The benefits of practicing chapter wise important questions are–

The students will get to know the question pattern.

The revision and exam preparation will be easier.

The students will achieve efficiency by practicing the questions repeatedly.

The students can practice the questions considering the time to increase time management capability.

Significance of CBSE Class 11 Business Studies term 2 Important Questions with Solutions

There are a total of 11 chapters in the Class 12 Business Studies syllabus . These chapters are based on important topics such as business, trade, commerce, modes of business, business services, company formation, international business, internal trade, etc.

The syllabus has been divided into two parts for the convenience of the students. To make the preparation of all the chapters on these two parts easier, students complete solving the exercises and then proceed to solve the important questions. These Important Questions for Class 11 Business Studies Board Exam have been framed by the top subject experts of Vedantu to cover the entire syllabus properly.

These questions come with proper solutions framed by the same experts to offer convenience in solving them. These solutions will aid the students to focus on the answering formats and how to use the concepts of this subject in a better way.

Hence, these important questions will enable students to test their preparation level and to find out how to solve fundamental questions to score more in the exams.

Advantages of CBSE Class 11 Business Studies Important Questions with Answers PDF

All 11 chapters have been approached individually to form separate files. These files can be found on the list here to download. Hence, you can add more convenience to your study sessions by accessing these files easily.

Resolve doubts on your own when you have the solutions for all these chapters here. These solutions will come in very handy when any query arises. You can answer those queries instantly and proceed with your preparation.

Focus on how the experts have used the simplest explanation of all the answers in the solutions. Learn from the formats and practice to answer all exam questions within the given time and score more.

Recall all the concepts and principles you have studied in these solutions easily and answer the questions accurately in an exam.

Solved Examples

1. Why is Insurance Known as the Tertiary Industry?

Solution: Insurance is a support service to the primary and secondary services. Tertiary industries are concerned with providing support services. The services are to primary and secondary industries as well as activities relating to trade, which provide service facilities. Therefore, insurance is known as the tertiary industry.

2. Categories the Following into Profession, Business, and Employment: Farmer, Clerk, Advocate, Hawker, Person Working in Repairing Shop, Doctor.

Farmer – Business

Clerk – Employment

Advocate – Profession

Hawker – Business

A person working in repairing shop – Employment

Doctor – Profession

3. Explain the Meaning of Unlimited Liability.

Solution: Unlimited liability refers to the indefinite extent of liability to pay a firm’s obligations, extending beyond the investments of the firm’s owners, partners, or shareholders to their assets. This extent of liability is supposed to be an unlimited liability company, which can be a sole proprietorship or general partnership.

4. A Special Act of Parliament Bought Which Public Sector Form Into Existence?

Solution: Statutory corporations are the special act of the parliament. The act defines its functions and powers, rules and regulations, and its relationship with departments of the government. They have the power of the government and a considerable amount of operating flexibility of private enterprises.

5. Define the Meaning of Banking.

Solution: A banking company is the one transacting the business of banking. It means accepting for investment and lending of deposits of money. The acceptance is from the repayable on demand, or the public, or otherwise and withdrawal by drafts, cheques, order, or otherwise. Basically, a bank accepts money repayable on demand, public, and also earns a profit by lending money.

6. Define Outsourcing.

Solution: Outsourcing is a long-term contracting out of the non-core and of late even some of the core activities. The captive or third-party specialists benefit from their experience, expertise, efficiency, and even investment.

7. Define the One Need for Social Responsibility.

Solution: A socially responsible company can create a company’s image and build its brand. By projecting a positive image, a company can make a name for not only being financially profitable but socially conscious as well.

8. What is the IEC Number?

Solution: ICE number refers to import export code number, which is obtained from the Directorate General Foreign Trade (DGFT) or Regional Import Export Licensing Authority. It is a prerequisite to obtaining an export license.

Download Class 11 Business Studies Important Questions with Answers PDF 2024-25

Get the free PDF versions of these questions for all the chapters. Focus on how you can make your preparation better by practising these questions. Learn to use the solutions and methods provided by the experts to grow your answering skills. Develop your concepts for Class 11 Business Studies and ace all the exams by becoming more confident.

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FAQs on Important Questions for CBSE Class 11 Business Studies (2024-25)

1. Explain 6 important factors that are to be considered for starting a business.

The 6 important factors that are to be considered for starting any business are as follows.

The Selection of Business Line: Select your business line wisely, that is, ensure the possibility of business growth and profitability when you select the nature and type of business.

The Size of the Business: Depending on the market demand and supply of your business products, select the size of your business. For high demands and fewer risk factors, select a large-scale business, and for high-risk factors select a small-scale business.

Choice of the Ownership Form: The type of ownership of your business depends on the line of business, capital requirements, legal formalities, the liability of owners, etc.

Location of the Business Firm: The location of the business firm depends upon the availability of labourers and raw materials.

Financing the Proposition: Financing the business proposition includes arranging the necessary capital for the business.

Physical Facilities: To start a business, it is important to check for the availability of machines, equipment, and other services.

Plant Layout: The layout of the business details has to be chalked out well in advance.

Competent Workforce: Arranging for a competent workforce is one of the basic necessities for starting a business. The growth of the business depends greatly on the workforce.

Tax Planning: Proper tax planning is necessary for every business, be it large-scale or small-scale.

Launching a Business Firm: With all the above factors taken care of, the business or the enterprise can be launched successfully.

2. What are the types of a service business?

There are three types of service businesses or enterprises, and they are as follows.

Micro Enterprises: The investment in the business equipment is within 10 lac rupees. 

Small Enterprises: The investment in the business equipment is between 10 lacs and 2 crores rupees.

Medium Enterprises: The investment in the business equipment is between 2 and 5 crore rupees.

3. Give two advantages of supermarkets.

The two advantages of supermarkets are as follows.

Sales are all carried out in cash or cards, leaving no chances of debts.

A wider variety of goods are available in the supermarkets, making it more likely for the buyers to end up making a purchase.

4. Are the important questions for CBSE Class 11 Business Studies beneficial for exam preparation?

Yes, the important questions for CBSE Class 11 Business Studies available on Vedantu are highly beneficial for exam preparation. Our in-house team of subject matter experts has curated and prepared these questions and solutions after making a detailed study of the entire syllabus of Class 11 Business Studies. The important questions from each chapter are arranged in a separate PDF file, for the convenience of students. You can download these files for free from Vedantu and refer to them for effective learning. These important questions also make an excellent study material for the Class 11 Business Studies examination. Therefore, download the PDF files and revise all the topics of Class 11 Business Studies by referring to these important questions and answers.

5. Where can I get the list of Important Questions of Class 11 Business Studies?

When looking for important questions for Class 11 Business Studies, the best place to be at is Vedantu’s e-platform. Students can find accurately chosen and explained questions that are important to prepare before their Class 11 Business Studies exams. The solutions for these questions have been carefully crafted by subject experts at Vedantu. The important questions and their solutions can be downloaded free of cost by students for offline access. You can also easily access them from Vedantu’s website. These solutions are available at free of cost on Vedantu(vedantu.com) and mobile app.

6. What are the chapters covered in Important Questions for Class 11 Business Studies?

Important Questions for CBSE Class 11 Business Studies provided by Vedantu cover the following chapters:

Chapter 1 - Business, Trade and Commerce

Chapter 2 - Forms of Business Organisation

Chapter 3 - Private, Public and Global Enterprises

Chapter 4 - Business Services

Chapter 5 - Emerging Modes of Business

Chapter 6 - Social Responsibilities of Business and Business Ethics

Chapter 7 - Formation of a Company

Chapter 8 - Sources of Business Finance

Chapter 9 - Small Business

Chapter 10 - Internal Trade

Chapter 11 - International Business

7. How many books are there for Class 11 Business Studies?

The Central Board of Secondary Education (CBSE) prescribed only one book for Class 11 Business Studies. This book has been published by NCERT and it is available in both English and Hindi mediums. There are a total of 10 chapters in this book divided into two parts. Part A contains six units that discuss knowledge about the business foundation and part B consists of the remaining four units that talk about financial and trading knowledge.

8. What are the most important chapters in Class 11 Business Studies?

The syllabus for Class 11 Business Studies contains a total of 10 chapters. Out of these, the most important chapters are Chapter 7 - Sources of Business Finance, Chapter 8 - Small Business, Chapter 9 - Internal Trade, and Chapter 10 - International Business. These are considered important since they contain higher weightage than all other chapters in the syllabus. Students can refer to Important Questions for CBSE Class 11 Business Studies for better preparation of these chapters.

9. What is meant by Banking?

As discussed in Class 11 Business Studies, banking is the term given to all activities related to business that involve accepting and safekeeping money owned by other entities for the purpose of lending or investment. The money that is deposited is also repayable on demand or otherwise, and withdrawable by cheque, order, draft, etc. It is an important service facilitating the economy by offering people an opportunity to save.

Important Questions for CBSE Class 11

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CBSE Class 11 Business Studies Revision Notes Chapter 7

Home » CBSE » CBSE Class 11 Business Studies Revision Notes Chapter 7

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CBSE Class 11 Business Studies Revision Notes Chapter 7 – Formation of a Company 

Students can gain a thorough understanding of the principles of company formation by referring to the Class 11 Business Studies Chapter 7 Notes . The chapter covers all topics related to the formation of a company, promotion of a company, functions of a promoter, documents required for registration of a company and so on. Business Studies Class 11 Chapter 7 Notes by Extramarks are written by subject-matter experts in accordance with the updated CBSE Syllabus .

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Revision Notes for CBSE Class 11 Business Studies Chapter 7 – Free Download

Access class 11 business studies chapter 7 – formation of a company notes , formation of a company  .

The process of forming a company is time-consuming and involves many legal procedures and formalities.

The three important steps in the formation of a company are:

• Incorporation  
• Subscription of capital

Unlike a public limited company, which cannot raise funds from the public, a private company is not required to either produce a prospectus or complete the formalities of a minimum subscription.

According to Section 2(69) of the Companies Act 2013, a promoter is one: 

• who is identified as one by the company in the annual return referred to in section 92 or who has been named as one in a prospectus;
• who controls the company’s operations directly or indirectly, whether as a director, shareholder, or in another capacity; or
• whose orders, recommendations or advice are followed by the Board of Directors of the company; however, nothing in this sub-clause applies to someone who is merely acting in their professional capacity.

Functions of Promoter

• Identification of a business opportunity – A promoter is entrusted to identify a business opportunity, that could be either in the form of making a product available through a new channel, developing a new product or service, or any other. A promoter also assesses the technical and economic feasibility of such an opportunity. 
• Feasibility studies – It is not always feasible or profitable to turn all potential business ideas into actual projects. As a result, the promoters are needed to do extensive feasibility assessments.

The following feasibility studies are carried out:

• Technical feasibility: An excellent idea may not be technically feasible to implement as raw materials like material, labour, technology, infrastructure, etc are not readily available. 
• Financial viability: An adequate capital is essential for the smooth running of a business. Therefore, the promoters calculate the capital required to pursue the recognised business idea. If the capital cannot be secured, the project is abandoned.
• Economic feasibility: The project might be technically and financially possible, but it may not be profitable. Therefore, this step focuses on the cost-benefit analysis of the project to find out its viability.
• Name approval – The promoter chooses a name for the company and is entrusted to apply for the registration in the registrar of companies. 
• Fixing the Signatories to the Memorandum of Association – The promoters choose the individuals who will sign the proposed company’s memorandum of association. To act as Directors and to purchase the Company’s Qualifying Shares, they must provide their written consent.
• Appointment of professionals – The promoters select auditors, mercantile bankers and others to assist them in preparing the essential documents needed to be filed with the Registrar of Companies.
• Preparation of necessary documents – In order for the company to be registered, the promoter takes steps to prepare all of the documents that must be submitted to the Registrar of Companies. Among them are the Memorandum of Association, Articles of Association and Directors’ Consent.

Documents required to be submitted

The following six documents are required to be submitted for registration of a company:

• Memorandum of Association – It specifies the company’s goals. It is duly signed, stamped and witnessed. For a public company, it is signed by at least seven members. However, in the case of a private company only two members’ signatures are sufficient. No company can legally engage in activities that are not included in its memorandum of association.

Some of the clauses included in the Memorandum of Association are as follows: 

• Name Clause
• Registered Office Clause
• Object’s Clause
• Liability Clause
• Capital Clause
• Subscription Clause 
• Articles of Association – An organisation’s internal management is governed by its Articles of Association. Nothing in the Memorandum of Association should be in conflict with or superseded by these regulations because they are an addendum to it.
• Consent of Proposed Directors – In addition to the Memorandum and Articles of Association, everyone nominated as a director must give their written consent by signing and stating that they accept to function as directors and agree to purchase and pay for qualification shares.
• Agreement – The agreement that the firm signs with its Director or a full-time Director or Manager is required to be submitted to the Registrar for the company to be registered. 
• Statutory Declaration: This document, which must be submitted to the Registrar with the other documents mentioned above in order for the company to be registered, establishes the fact that all legal requirements for registration have been satisfied.
• Receipt of Payment of Fee – The necessary fees for the company’s registration must be paid. The number of such fees is determined based on the company’s authorised share capital.

Position of Promoters

• The promoters have a fiduciary relationship with the company, i.e. a relationship based on trust and confidence. 
• The promoters cannot make any hidden gains. They can only make a profit that is publicly revealed. 
• In the event of non-disclosure, the company can cancel the contract and reclaim the money paid to the promoters.
• The company can also sue the promoters for damages or losses incurred because of material information not being disclosed.
• Promoters cannot claim expenses incurred in the company’s promotion. The company, on the other hand, has a legal right to choose to reimburse them for their pre-incorporation costs.

Effect of the Certificate of Incorporation

• The legal existence of the company is marked by the date inscribed on the Certificate of Incorporation.
• On the date inscribed, the company becomes a separate legal entity with perpetual succession. It becomes free to enter legally binding contracts.

Process of Capital Subscription 

Public companies require SEBI clearance to raise funds from the public since a request for approval to trade in shares or debentures is to be made to the stock exchange. A copy of the prospectus or a statement in lieu of the prospectus is received by the Registrar of Companies. 

• SEBI Approval

The Securities and Exchange Board of India has issued recommendations for information disclosure and investor protection. In order to raise money from the public, a public company must fully disclose all pertinent information to potential investors and must not withhold any material information.

• Filing of Prospectus

The prospectus includes all notifications, circulars, advertisements and other relevant information that serves as an invitation to public offers. A copy of the prospectus or a statement in lieu of the prospectus is received by the Registrar of Companies.

• Appointment of Bankers, Brokers and Underwriters

In order to sell the company’s shares, brokers are hired to distribute application forms and encourage others to submit them. In the event that no one orders shares, the underwriters later purchase them. 

• Minimum Subscription

To prevent enterprises from starting their business with insufficient resources, the company obtains applications for a minimum number of shares before proceeding with the issuance of shares further. This limit of the minimum number of shares is defined as ‘minimum subscription’ under the Companies Act.

• Application to Stock Exchange

Every company must request permission from at least one stock exchange before trading in its shares or debentures. The allocation loses value if such approval is not obtained within ten weeks of the closing date of the subscription list.

• Allotment of Shares

The money received for the share application is kept in a separate bank account and not used by the company until its shares are distributed. If the number of shares allocated is less than the number applied for, or if no shares are assigned to the applicant at all, any excess application money is returned.

Business Studies Class 11 Notes Chapter 7 Formation of a Company 

The Formation/Incorporation of a company involves the registration of a new company under the laws of the land. It is only after the incorporation that the company is considered a separate legal entity and is seen as a person by the law. Chapter 7 Business Studies Class 11 Notes includes all the topics of the chapter for in-depth learning. The notes cover the topics in a precise and easy-to-understand manner, thus making it easier for students to prepare the chapter thoroughly for their exams.

Stages in Formation of a Company

Business Studies Class 11 Notes Chapter 7 discusses all the stages in the formation of a company in detail. Since the formation of a company is a time taking process, the process is divided into many stages. 

• Promotion Stage: It is the first stage of the formation of a company, where activities are designed to promote the business operations of the proposed company. 
• Registration Stage: It is the stage where a company gets registered under the Companies Act.
• Certificate of Incorporation: Following the company’s registration by submitting the necessary paperwork to the registrar, a certificate of incorporation is issued, attesting to the company’s compliance with the Companies Act.
• Certificate of Commencement: A public company additionally requires a Certificate of Commencement to launch its operations, whereas a private company may do so following the issuance of a Certificate of Incorporation. The company is issuing this certificate in order to increase its share capital.

Documents Required in the Formation of a Company

The documents required for the formation of a company are as follows: 

• Memorandum of Association: The memorandum of association is an essential document in the registration process of the company. This record is also known as a memorandum. 
• Articles of Association: This document provides information about the rules and regulations as well as the purpose or goal of the company. This is considered an essential document in the registration process as it specifies how the tasks in the company will be executed.
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FAQs (Frequently Asked Questions)

1. what does the promoter of a company do.

A company’s promoter is responsible for performing the preliminary works involved in the process of formation of a company. He/she performs many activities including promotion, floatation, incorporation and motivating people to invest money in the company. Execution of all these activities is done when the company is getting registered. 

2. What do you mean by the incorporation of a company?

The incorporation of a company refers to the registration and establishment of a new company according to the laws of the land. This process is also known as the formation of a company. After the company is registered under the given laws of the land, it becomes a legal organisation owned by an individual or a group of individuals, having a separate legal identity and perpetual existence.  

3. What is the effect of the Certificate of Incorporation on the formation of a company?

The legal existence of the company is marked by the date inscribed on the Certificate of Incorporation. On the date inscribed, the company becomes a separate legal entity with perpetual succession. It becomes free to enter legally binding contracts.

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Business Studies Class 11 Exam Questions

Please refer to Business Studies Class 11 Exam Questions with solutions below. These important exams solved questions have been prepared based on the latest books and syllabus issued by CBSE, NCERT, and KVS. Our team of expert teachers of Class 11 Business Studies has designed these based on the latest examination guidelines and the type of questions expected to come in the examinations.

Exam Questions Class 11 Business Studies

We have provided exam questions with solutions for all chapters in Standard 11 Business Studies. You should learn these before the examinations as the answers have been designed to help you get better marks. You can click on the chapter-wise links below to access all problems and solutions for free. These will also help you to clear all concepts and improve your understanding of Business Studies in Class 11.

Chapterwise Important Questions Class 11 Business Studies

It is important for students to prepare for Class 11 Business Studies exams properly and practice questions and answers which have been designed based on the latest guidelines on the type of questions to be asked in the upcoming class 11 Economics examination. We have also provided MCQ Questions for Class 11 Business Studies which will be very useful for students. This year more MCQ-based questions and Case study-based questions are expected in examinations. We have provided all the latest questions which are expected to come in exams on our website. Students in Class 11 should download these questions in Pdf and share with teachers and friends.

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MCQs for CBSE Class 11 Business Studies Chapter 7 Formation of a company: Based on Latest CBSE Syllabus 2023-2024

Find mcqs for cbse class 11 business studies chapter 7, formation of a company, for free download in pdf. also, find attached links to essential resources for preparation for end-term exams in 2024.

MCQs for CBSE Class 11 Business Studies Chapter 7 : This article presents essential Multiple-Choice Questions for CBSE Class 11 Business Studies Chapter 7, Formation of a Company. You can also find attached a PDF download link for future reference. The class 11 Business Studies textbook has been divided into two parts. MCQs for Part 1 have been covered in the previous articles, links to which have been attached further in the article. Now, we have prepared a list of MCQs for CBSE Class 11 Business Studies Part 2 (Corporate Organization, Finance, and Trade), Chapter 1, Formation of a Company.

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MCQs for CBSE Class 11 Business Studies Chapter 1

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MCQs for CBSE Class 11 Business Studies Chapter 4

MCQs for CBSE Class 11 Business Studies Chapter 5

MCQs for CBSE Class 11 Business Studies Chapter 7 Formation of a Company

MCQs for CBSE Class 11 Business Studies Chapter 7 Formation of a Company have been presented below for students of the 2023-2024 batch. Since your final exams are just around the corner, it becomes important for the aspirants to practice from as many study materials as possible. You can also check the PDf download link attached below for your reference. The link has free access for all the students who would like to save the list of MCQs for future reference. 

1.Which of the following are the functions of a promoter?

(a) Appointment of professionals

(b) Feasibility studies

(c) Name approval

(d) All of the above

Answer. d) All of the above

2.Which of the following document is to be submitted for getting the company registered?

(a) Memorandum of Association

(b) Articles of Association

(c) Both a & b

(d) None of the above

Answer. c)Both a and b

3.________are neither the agents nor the trustees of the company

(a) Registrar

(b) Registree

(c) Promoters

(d) Preliminary Contracts

Answer. c) Promoters

4.Choose the correct steps for raising funds from the public.

(i) SEBI Approval

(ii) Minimum subscription

(iii) Appointment of brokers, bankers, underwriters

(iv) Application to the stock exchange

(v) Filing of the prospectus

(vi) Allotment of shares

a) i>iii>iv>vi>ii>v

b) i>ii>iii>iv>v>vi

c) i>vi>iv>iii>ii>v

d) i>v>iii>ii>iv>vi

Answer. d) i>v>iii>ii>iv>vi

5.What does DIN stand for?

(a) Director Identification Number

(b) Direction Identification Number

(c) Document Identification Number

(d) Drug Identification Number

Answer. a) Director Identification Number

6.When was One Person Company?

Answer. a) 2013

7. As per the SEBI guidelines, the minimum subscription has to be 90% of the shares to be issued to be public.

(c) Partially true

(d) Partially false

Answer. a) True

8.____defines relationship of the company with the outsiders

(a) Articles of Association

(b) Memorandum of Association

(c) Both (a) & (b)

Answer. b) Memorandum of Association

9.Contracts signed by promoters with third parties before the incorporation of the company is called---

(a) Preliminary Contracts

(b) Provisional Contracts

(c) Memorandrum of Association

(d) Articles of Association

Answer. a) Preliminary contracts

10.Promoter is a person who---

(a) Who has been named as such in a prospectus?

(b) Who is identified by the company in the annual return referred to in section 92

(c)Who has control over the affairs of the company, directly or indirectly  whether as a shareholder, director, or otherwise

(d)All of the above

11.Different Clauses of Memorandum of Association are:

(a) Name clause

(b) Objects Clause

(c) Liability clause

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Class 11th Business Studies - Business Service Case Study Questions and Answers 2022 - 2023

By QB365 on 09 Sep, 2022

QB365 provides a detailed and simple solution for every Possible Case Study Questions in Class 11 Business Studies Subject - Business Service, CBSE. It will help Students to get more practice questions, Students can Practice these question papers in addition to score best marks.

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Business service case study questions with answer key.

11th Standard CBSE

Final Semester - June 2015

Business Studies

Demonetization in India led to the need for cashless economy. It had a great impact on banking industry. Banks were overflowing with old currency on the one hand and were in cash crisis for new currency. Gradually the problem smoothened but now a hawker and peddler are accepting Paytm, mpesa and other forms of digital cash. Promotion of "mera mobile mera batuaa" concept motivated even the cobbler, hair cutters, vegetable and fruit vendors and other small service providers to accept digital cash and cashless forms. Popularity of plastic money (debit and credit cards) also increased. (a) In the light of above facts, discuss the importance of banking in business and trade. (b) How will demonetization create new aids to trade?

Sanjana obtained a life insurance policy of her husband. After 5 years, her husband dies of cancer. At the time of policy also Sanjana and her husband were aware of the disease but they did not disclose it to the insurance company. (a) Can she claim the amount of policy from the insurance company? (b) Identify the principle of insurance involved. (c) Explain two more principles of insurance.

A person gets his house insured, but he hides the fact that he stores petrol in his house. His house catches fire. He does not bother to minimize the loss as he felt that his house is insured so it is not his headache to make an effort to minimize the loss. (a) Can he claim compensation? (b) State the name of principles involved. (c) Explain these principles.

Mr. X applied for a loan from State Bank of India to expand his shop under Pradhan Mantri Mudra Yojna. Later he purchased a home by taking a home loan from bank. Then he purchased a car on EMI financed by a bank. He also has a saving account with the bank. All his EMIs are getting deducted from his saving account. He has also taken a locker facility from the bank where he keeps his important documents and valuables. (a) Identify primary functions of commercial bank that Mr. X is availing of. (b) Identify agency functions of commercial bank Mr. X is availing of. (c) Identify general utility functions of commercial bank Mr. X is availing of.

One fine day, government announced some policy which was against the interests of truck drivers. As a result, all truck drivers went on strike. Strike continued for three days. It created a calamity kind of situation in the country. People started facing problems even for basic needs. Businesses had to pay labour without work. Many factories could not•..be operational. Many others had to send goods at a higher price to maintain their market. It led to rise in prices of even basic goods. Ultimately government has to accept the demands of truck drivers so that they discontinue the strike. (a) In the light of above facts, discuss importance of transportation in business and trade. (b) How can transportation strike create calamity kind of situation?

Shilpi is planning to start a business. She is having a place where she will establish her factory. But she has no space for warehouse. She is under an impression that she must have a private warehouse if she wants to run business successfully. She is not having enough funds to own a private warehouse. (a) Is she right in her opinion? (b) What are other options she has?

*****************************************

Business service case study questions with answer key answer keys.

(a) Banking is very important for business and trade. It helps in transfer of funds in transactions. Modern means of transfer of funds include: • Debit cards • Credit cards • NEFT • Mobile banking • Digital cash. (b) Digital cash like Paytm, Mpesa etc are new aids to trade.

(a) No, he cannot claim the compensation. (b) Principle of utmost good faith is not followed.   According to this principle, it is the duty of the insurer and insured to voluntarily make full accurate disclosure of all facts, material to the insurance contract. (c) Principle of indemnity: Indemnity means security or compensation against loss or damage. The principle of indemnity is such principle of insurance stating that an insured may not be compensated by the insurance company in an amount exceeding the insured's economic loss. In type of insurance, the insured would be compensation with the amount equivalent to the actual loss and not the amount exceeding the loss. This is a regulatory principal. This principle is observed more strictly in property insurance than in life insurance. The purpose of this principle is to set back the insured to the same financial position that existed before the loss or damage occurred. Principal of subrogation: The principle of subrogation enables the insured to claim the amount from the third-party responsible for the loss. It allows the insurer to pursue legal methods to recover the amount of loss, For example, if you get injured in a road accident, due to reckless driving of a third party, the insurance company will compensate your loss and will also sue the third party to recover the money paid as claim.

(a) No, he cannot claim the compensation (b) Principle of utmost good faith (c) Principle of utmost good faith is not followed:  According to this principle, it is the duty of the insurer and insured to voluntarily make full accurate disclosure of all facts, material to the insurance contract. Principle of mitigation: If refers that the insured should try to minimize the loss of the subject matter of the insurer even if it is insured.

(a) (i) Accepting of Deposits: He also has a saving account with the bank. (ii) Granting of Loans: Mr. X applied for a loan from State Bank of India to expand his shop under Pradhan Mantri Mudra Yojna. Later he purchased a home by taking a home loan from bank. Then he purchased a car on EMI financed by a bank. (b) Payments and Acceptance of collections on behalf of client: All his EMIs are getting deducted from his saving account. (c) Locker Facility: He has also taken a locker facility from the bank where he keeps his important documents and valuables.

(a) Transportation is extremely important for business and trade. (i) Transportation removes the hindrance of place and makes goods available to the consumer from the place of production. It helps a factory or business house to get raw material and sell finished goods to the final consumer. (ii) It helps to stabilize prices by moving the goods from the place where they are in excess supply to the place where they are scarce. Transportation removes the hindrance of place and makes goods available to the consumer from the place of production. (iii) Transportation is required in the process of production and distribution offinished goods to market. (iv) Efficient transportation reduces the cost of production and distribution and thereby the selling price of a product - Low price - mass consumption. (v) It helps to stabilize prices by moving the goods from the place where they are in excess supply to the place where they are scarce. (b) When basic needs like fruits, vegetables, milk etc are not available, it creates calamity kind ofsituation. Household do not get basic needs. Business houses are not getting raw material and are unable to sell their finished goods. Certainly it creates calamity kind of situation in the country.

(a) No, she is not right. (b) She has following two options (i) Public warehouse: Govt. regulates their operation by issuing licenses for them to private parties. They can be used for storage of goods by traders, manufacturers or public after payment of fees. (ii) Cooperative warehouse: Owned, managed and controlled by some marketing cooperative societies for their own members. In India, the National Cooperative Development cooperation is developing co-operative warehouse.

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Case Study Questions for Class 11 Maths Chapter 7 Permutation and Combinations

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[PDF] Download Case Study Questions for Class 11 Maths Chapter 7 Permutation and Combinations

Here we are providing case study questions for class 11 maths. In this article, we are sharing Class 11 Maths Chapter 7 Permutation and Combinations . All case study questions of class 11 maths are solved so that students can check their solutions after attempting questions.

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What is meant by case study question.

In the context of CBSE (Central Board of Secondary Education), a case study question is a type of question that requires students to analyze a given scenario or situation and apply their knowledge and skills to solve a problem or answer a question related to the case study.

Case study questions typically involve a real-world situation that requires students to identify the problem or issue, analyze the relevant information, and apply their understanding of the relevant concepts to propose a solution or answer a question. These questions may involve multiple steps and require students to think critically, apply their problem-solving skills, and communicate their reasoning effectively.

Importance of Solving Case Study Questions for Class 11 Maths

Case study questions are an important aspect of mathematics education at the Class 11 level. These questions require students to apply their knowledge and skills to real-world scenarios, helping them develop critical thinking, problem-solving, and analytical skills. Here are some reasons why case study questions are important in Class 11 maths education:

• Real-world application: Case study questions allow students to see how the concepts they are learning in mathematics can be applied in real-life situations. This helps students understand the relevance and importance of mathematics in their daily lives.
• Higher-order thinking: Case study questions require students to think critically, analyze data, and make connections between different concepts. This helps develop higher-order thinking skills, which are essential for success in both academics and real-life situations.
• Collaborative learning: Case study questions often require students to work in groups, which promotes collaborative learning and helps students develop communication and teamwork skills.
• Problem-solving skills: Case study questions require students to apply their knowledge and skills to solve complex problems. This helps develop problem-solving skills, which are essential in many careers and in everyday life.
• Exam preparation: Case study questions are included in exams and tests, so practicing them can help students prepare for these assessments.

Overall, case study questions are an important component of Class 11 mathematics education, as they help students develop critical thinking, problem-solving, and analytical skills, which are essential for success in both academics and real-life situations.

Feature of Case Study Questions on This Website

Here are some features of a Class 11 Maths Case Study Questions Booklet:

Many Case Study Questions: This website contains many case study questions, each with a unique scenario and problem statement.

Different types of problems: The booklet includes different types of problems, such as optimization problems, application problems, and interpretation problems, to test students’ understanding of various mathematical concepts and their ability to apply them to real-world situations.

Multiple-choice questions: Questions contains multiple-choice questions to assess students’ knowledge, understanding, and critical thinking skills.

Focus on problem-solving skills: The questions are designed to test students’ problem-solving skills, requiring them to identify the problem, select appropriate mathematical tools, and analyze and interpret the results.

Emphasis on practical applications: The case studies in the booklet focus on practical applications of mathematical concepts, allowing students to develop an understanding of how mathematics is used in real-life situations.

Comprehensive answer key: The booklet includes a comprehensive answer key that provides detailed explanations and step-by-step solutions for all the questions, helping students to understand the concepts and methods used to solve each problem.

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MCQ Questions Class 11 Business Studies Chapter 7 Formation of a Company with Answers

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Free PDF Download of CBSE Class 11 Business Studies Chapter 7 Formation of a Company Multiple Choice Questions with Answers.Based on Latest Exam Pattern. Students can solve MCQ NCERT Class 11 Business Studies Chapter 7 Formation of a Company Multiple Choice Questions with Answers to know their preparation level.

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Class 11 Business Studies Chapter 7 Formation of a Company MCQ Questions with Answers

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1. The certificate of capital will be issued by

2. Preliminary Contracts are signed

3. A company is known as the _______company of another company if it has control over that other company.

4. A copy of the ________________ must accompany each from of application for shares offered to the public.

5. The application for registration of a company should be presented to the _______________ of the state appointed under Companies Act 1956

6. A statement of nominal capital must be given at the time of incorporation by the company when the share capital is less than

7. A prospectus is issued by

8. Minimum number of members required to apply for incorporation certificate in a public ltd company is

9. Men may come and men may go but the company exist”- this explains which characteristics of the company as per companies Act 1956

10. The Prospectus must be issued to the public within ______________ days of its date

11. Minimum number of members to form a private company is

12. Application for approval of name of a company is to be made to

13. The address of the registered office of the company must be notified to the registrar within _________ days of registration, if it is not done at the time of incorporation

14. ___________ cannot give invitation to the public to subscribe for any shares in or debentures of the company

15. The shares of a _______________ company can be freely transferable

16. A private company means a company which has a minimum paid up capital of Rs.————-

17. Which of the following clause of Memorandum of Association cannot be altered

18. Which of the following is not a clause of memorandum of association

19. Private company prohibits any invitation or acceptance of deposits from persons other than its ___________

20. The company will be considered as separate person and different from its members from the date (when the) _____________

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