Chapter Exam

Unit 2: Forms of Business Organizations — Online MCQ Test

Q: Which form of business organization is owned, controlled, and managed by a single person?

Answer: C. Sole proprietorship — In a sole proprietorship, a single individual owns and controls the business. It is the simplest form of business organization.

Q: In a Hindu Undivided Family (HUF) business, the manager of the family business is called the:

Answer: B. Karta — The senior-most member of a Hindu Undivided Family business who manages it is called the Karta. He has control over the business affairs.

Q: A business started by one person with unlimited liability is most suitable when:

Answer: B. Quick decision-making is important — A sole proprietorship allows quick decisions because the owner alone controls the business. It suits small businesses with simple operations.

Q: Which form of business organization combines the advantages of limited liability and separate legal entity?

Answer: C. Joint-stock company — A joint-stock company has separate legal existence and generally offers limited liability to shareholders. These are key advantages of the company form.

Q: A businessman wants full control, easy formation, and complete secrecy, but can tolerate unlimited liability. Which form should he choose?

Answer: C. Sole proprietorship — Sole proprietorship gives full control, simplicity, and secrecy to the owner. The main drawback is unlimited liability, which the businessman is willing to accept.

COMMERCE & ACCOUNTANCY · CLASS 11 INTERMEDIATE 1 YEAR · Telangana State Board

Practice Unit 2: Forms of Business Organizations with a free chapter-wise online MCQ test for Telangana State Board CLASS 11 INTERMEDIATE 1 YEAR COMMERCE & ACCOUNTANCY. This chapter covers: This chapter details sole proprietorship Hindu Undivided Family partnership firms cooperative societies and joint-stock company structures advantages disadvantages and suitability.. AI-generated questions from basic to board-exam level, with instant results and explanations.

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Unit 2: Forms of Business Organizations — Important Questions & Answers (FAQ)

Frequently asked questions from Telangana State Board CLASS 11 INTERMEDIATE 1 YEAR COMMERCE & ACCOUNTANCY — Unit 2: Forms of Business Organizations, with answers and explanations. These are sample questions; the exam has its own separate question set.

Which form of business organization is owned, controlled, and managed by a single person?

A. Partnership firm
B. Joint-stock company
C. Sole proprietorship ✓
D. Co-operative society

Answer: C. Sole proprietorship
In a sole proprietorship, a single individual owns and controls the business. It is the simplest form of business organization.

In a Hindu Undivided Family (HUF) business, the manager of the family business is called the:

A. Partner
B. Karta ✓
C. Director
D. Secretary

Answer: B. Karta
The senior-most member of a Hindu Undivided Family business who manages it is called the Karta. He has control over the business affairs.

A business started by one person with unlimited liability is most suitable when:

A. Large capital is required immediately
B. Quick decision-making is important ✓
C. Many expert managers are needed
D. Ownership must be widely spread

Answer: B. Quick decision-making is important
A sole proprietorship allows quick decisions because the owner alone controls the business. It suits small businesses with simple operations.

Which form of business organization combines the advantages of limited liability and separate legal entity?

A. Sole proprietorship
B. Partnership firm
C. Joint-stock company ✓
D. Hindu Undivided Family

Answer: C. Joint-stock company
A joint-stock company has separate legal existence and generally offers limited liability to shareholders. These are key advantages of the company form.

A businessman wants full control, easy formation, and complete secrecy, but can tolerate unlimited liability. Which form should he choose?

A. Joint-stock company
B. Partnership firm
C. Sole proprietorship ✓
D. Co-operative society

Answer: C. Sole proprietorship
Sole proprietorship gives full control, simplicity, and secrecy to the owner. The main drawback is unlimited liability, which the businessman is willing to accept.

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Unit 3: Formation of Company as per Companies Act 2013