Forms of Business Organisation · Class 11 · CBSE · Commerce Business Studies
A company enters into a contract in its own name and acquires property independently of its shareholders. Which characteristic of a company is illust…
Practice question from Forms of Business Organisation (Class 11 · CBSE · Commerce Business Studies), with the correct answer and a step-by-step solution.
medium · MCQ · Q-960A37
A company enters into a contract in its own name and acquires property independently of its shareholders. Which characteristic of a company is illustrated?
- A.Limited liability of members
- B.Separate legal entityCorrect answer
- C.Perpetual succession of directors
- D.Centralised ownership
Solution
A company has a legal identity separate from that of its shareholders. Therefore, it can own property, enter contracts and sue or be sued in its own name.
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