Chapter-2 Forms of Business Organisation

One Mark Questions.

1. Write any one type of forms of business organisation.
Sole Proprietorship, Partnership, Joint Stock Company (any 1)
2. Give the meaning of sole trading concern.
It is a form of business organisation owned and managed by an individual by investing
capital.
3. Give any one example to sole trading concern.
Beauty Parlours, Retail Shops Etc.
4. Who is Karta?
Karta is the Eldest member and head of Hindu Undivided family business.
5. State the minimum and maximum members in partnership.
Minimum- 2 Maximum -10 in case of banking business, 20 in case of others
6. Write any one effect of non-registration of a partnership.
Unregistered firm cannot file a suit against anyone in the court of law.
7. Write any one type of partnership firm.
Partnership at Will, Particular Partnership, General Partnership (any 1)
8. Give the meaning of co-operative society.
It is a voluntary association of persons who join together for the welfare of the
members.
9. State the minimum & maximum members required for the formation of a co-operative
society.
Minimum-10 Maximum- Unlimited
10.Name any one type of co-operative society.
Consumers Co-operative society, Farmers Co-operative society (any 1)
11.State the liability of a sole trader.
Unlimited liability
12.State the liability of Karta.
Unlimited liability
13.Which Act governs the partnership firms in India?
Indian Partnership Act 1932
14.Which Act governs the co-operative societies in India?
Co-operative Societies Act 1912

15.State the liability of members of co-operative societies.

Limited.
16.State the voting principle in co-operative societies.
One man one vote.
17.State the main objective of co-operative societies.
Welfare of its members and to protect them against exploitation.
18.Who are co-parceners?
Co-parceners are the male members of HUF who have equal rights over ancestral
property.
19.State the liability of co-parceners.
Limited liability
20.Who is minor partner?
A person who is a minor according to the law admitted to the benefits of partnership.
21.Is registration of partnership compulsory?
No it is Optional
Two Mark Questions.
22.Write any two features of sole trading concern.
Easy formation and closure
Sole risk bearer and Profit recipient.
23.Give the meaning of HUF.
It is a form of business organization where business is owned and carried on by the
members of Hindu Undivided family. It is governed by Hindu law.
24.Define partnership.
According to Indian Partnership Act 1932, Partnership is the relation between persons
who have agreed to share the profit of the business carried on by all or any one of them
acting for all.
25.What is partnership deed?
It is a written agreement containing terms and conditions that govern the partnership.
26.Who is an active partner?
An active partner is one who contributes capital and actively participate in the
management of the firm.
27.What is particular partnership?
It is a partnership formed for completion of a particular project for a limited period of
time. It is dissolved once the project is complete or when the time duration expires.

28.Write any two features of co-operative society.

Voluntary membership
Service motive
29.What is credit co-operative society?
It is established for providing easy credit at reasonable interest to its members and to
protect them from moneylenders who charge high rates of interest.
30.What is unlimited liability?
It is a type of liability when the owners personal assets become liable if business
assets are not sufficient for paying business debts.
31.What are Housing co-operative societies?
Housing co-operative societies are established to help people with limited income to
construct a house at reasonable costs.
32.What are Consumer's co-operative societies?
Consumer's co-operative societies are established to help people in purchasing good
quality products at reasonable prices by purchasing goods in bulk directly from the
manufacturers, thereby eliminating middlemen.
33.What are Producers co-operative societies?
Producers co-operative societies are established to help small producers by purchasing
raw materials in bulk at lesser price and it also buys the products produced by small
producers at reasonable rates.
34.What do you mean by Partnership at will?
It is a type of partnership firm that exists at the will of the partners. It can continue as
long as the partners want and can be terminated when a partner give notice of
withdrawal from partnership to the firm.
35.What is general partnership?
It is type of partnership where all partners contribute capital and have the right to
participate in the management of the firm. Their liability is unlimited.
36.What is limited partnership?
It is type of partnership where at least one partners liability is limited and limited
partners do not have the right to participate in the management of the firm.
37.Who is nominal partner?
A Nominal partner is one who allows his/her name to be used by the firm but does not
contribute any capital and take part in management of the firm. He does not share
profits but he is liable for losses.
38.State any two contents of partnership deed.
Name of the firm
Duration of business

 Ratio of distribution of profits and losses

Duties and obligations of partners (any two)
Five Mark Questions.
39.Briefly explain any five demerits of sole trading concern.
40.Briefly explain any five features of sole trading concern.
41.Briefly explain the types of partnership firm.
42.Explain the procedure of registration of partnership firm.
43.Briefly explain any five demerits of co-operative society.
44.Briefly explain any five features of partnership firm.
45.Briefly explain five effects of non-registration of partnership.
46.Briefly explain any five features of co-operative society.
Ten Mark Questions.
47.Briefly explain any five merits and demerits of sole trading concern.
48.Briefly explain any five merits and demerits of co-operative societies.
49.Briefly explain any five merits and demerits of partnership firm.
50.What is partnership deed? State the contents of partnership deed.
51.Explain the different types of partners.
52.Explain the different types of co-operative societies.