Forms of Business Organisation · Class 11 · CBSE · Commerce Business Studies
Which statement correctly describes a Hindu Undivided Family business?
Practice question from Forms of Business Organisation (Class 11 · CBSE · Commerce Business Studies), with the correct answer and a step-by-step solution.
hard · MCQ · Q-0BD7A4
Which statement correctly describes a Hindu Undivided Family business?
- A.The business is managed by a board elected by all members
- B.Membership is created only through a written partnership agreement
- C.The karta manages the business, and the karta has unlimited liabilityCorrect answer
- D.All members have unlimited liability for the business debts
Solution
A Hindu Undivided Family business is managed by its head, known as the karta. The karta has unlimited liability, whereas the liability of other coparceners is generally limited to their interest in the family business.
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