ACCA AS Corporate & Business Law (UK) 1

Question 1

Which of the following correctly describes a 'contract'?

Accepted Answer

A legally binding agreement supported by offer, acceptance, consideration and intention to create legal relations

Answer

A valid contract requires: offer, acceptance, consideration, intention to create legal relations and capacity. Written form is not required for most contracts.

Question 2

In English contract law, consideration must be:

Accepted Answer

Sufficient but need not be adequate

Answer

Consideration must be sufficient (have some value in law) but need not be adequate (it need not be a fair or equal exchange). Courts do not investigate adequacy.

Question 3

Under the Companies Act 2006, a private company limited by shares is denoted by:

Accepted Answer

Ltd

Answer

A private company limited by shares uses the suffix 'Ltd' (or 'Limited'). Public companies use 'plc' (or 'Public Limited Company').

Question 4

Which of the following is a duty of a company director under the Companies Act 2006?

Accepted Answer

To act in the way they consider most likely to promote the success of the company for the benefit of its members

Answer

Section 172 CA 2006 requires directors to act in the way they consider, in good faith, most likely to promote the success of the company for the benefit of its members as a whole.

Question 5

Which type of company resolution requires a majority of more than 50% to pass?

Accepted Answer

Ordinary resolution

Answer

An ordinary resolution is passed by a simple majority (more than 50%). A special resolution requires at least 75% of votes cast.

ACCA Applied Skills Practice Test

ACCA Applied Skills Practice Test

ACCA AS Corporate & Business Law (UK) 1