Commercial Applications
Statement I : A company enjoys a good reputation and prestige in the business world.
Statement II : The membership of a public company is large and its ownership is generally diffused.
- Only I is correct
- Only II is correct
- Both I and II are correct
- Both I and II are wrong
Answer
Both I and II are correct
Reason — Both statements are correct. A company enjoys a good reputation and prestige in the business world due to its goodwill and public confidence built through disclosure of results and compliance with legal regulations. Its activities are subject to scrutiny by auditors and the government, which enhances public trust. The membership of a public company is large and its ownership is generally diffused among a large number of shareholders, which is the basis of democratic management in companies.
Related Questions
Statement I : A company is an artificial person created by law having no physical body of a natural human being.
Statement II : A company can't exist in the contemplation of law.
- Only I is correct
- Only II is correct
- Both I and II are correct
- Both I and II are wrong
The merit of a joint company is
- Continuity of Existence
- Capital Formation
- Limited Liability
- All of these
Statement I : Red tape and bureaucracy do not permit quick decisions and prompt action.
Statement II : The management of a company is supposed to be carried on according to the collective will of its members.
- Only I is correct
- Only II is correct
- Both I and II are wrong
- Both I and II are correct
Statement I : A public company is required to publish and file its accounts.
Statement II : It is very easy to maintain business secrets.
- Only I is correct
- Only II is correct
- Both I and II are correct
- Both I and II are wrong