ACA Business Law 1

Question 1

Under the Companies Act 2006, what is the minimum number of directors required for a private limited company?

Accepted Answer

One

Answer

The Companies Act 2006 requires a private limited company to have at least one director.

Question 2

Which of the following best describes the doctrine of separate legal personality established in Salomon v Salomon & Co Ltd [1897]?

Accepted Answer

A company is a legal entity distinct from its shareholders

Answer

Salomon v Salomon established that a company is a separate legal entity from its members, meaning it can own property, incur debts, and be sued independently.

Question 3

In English contract law, which element is NOT required for a valid contract to exist?

Accepted Answer

Written documentation

Answer

Most contracts in English law can be formed orally or by conduct; written documentation is generally not required unless statute demands it.

Question 4

Under the Insolvency Act 1986, what is the minimum unpaid debt required for a creditor to present a winding-up petition against a company?

Accepted Answer

£750

Answer

A creditor must be owed at least £750 (the statutory minimum) to present a winding-up petition under the Insolvency Act 1986.

Question 5

A director's duty to avoid conflicts of interest under the Companies Act 2006 is contained in which section?

Accepted Answer

Section 175

Answer

Section 175 of the Companies Act 2006 imposes a duty on directors to avoid situations where they have, or could have, a direct or indirect interest that conflicts with the company's interests.

ACA ICAEW Practice Test

ACA ICAEW Practice Test

ACA Business Law 1