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Hbs 2201/Hbc 2306: Company Law Question Paper
Hbs 2201/Hbc 2306: Company Law
Course:Bachelor Of Commerce
Institution: Kirinyaga University question papers
Exam Year:2015
KIRINYAGA UNIVERSITY
UNIVERSITY EXAMINATION 2015/2016
YEAR 11 SEMESTER 1 EXAMINATION FOR THE DEGREE OF BACHELOR OF HUMAN RESOURCE MANAGEMENT/BACHELOR OF COMMERCE
HBS 2201/HBC 2306: COMPANY LAW
INSTRUCTIONS
Answer question one [compulsory] and any other two questions
QUESTION ONE [30MKS]
a)A registered company is formed by registration under the company Act.Explain the different classifications of registered companies in Kenya. 10mks
b)Mr Kamau has invested his savings in XYZ ltd company by buying ordinary shares.As a shareholder Mr.Kamau is unaware of his right and he has requested you to explain such rights.Explain five rights of a shareholder such as Mr Kamau. 10mks
c)Explain the following terms as used in company capital
i.Nominal
ii.Issued capital
iii.Paid up capital
iv.Called up capital
v.Reserve capita 10mks
QUESTION TWO
a.Companies enjoy tremendous advantages compare to other forms of business due to incorporation.Discuss five practical benefits of incorporation. 10mks
b.The promoters have a duty to provide true information in the prospectus.Explain five liabilities imposed on a promoter due to untrue information in the prospectus. 10mks
QUESTION THREE
The promoter undertake the responsibility of transforming ideas into viable businesses.Discuss four key documents prepared by promoters who are desirous of forming a private company limited by shares. 20mks
QUESTION FOUR
a)Explain the difference between a voluntary winding up and a compulsory winding up,outlining the procedures to be followed in each type of winding up. 10mks
b)Concerned at the recession on the textile business,Onyango,a director of threads Ltd.,decided that the company should cease manufacturing textiles but should instead manufacture paper.Writing on note paper which described the company as paper manufactures,Onyango ordered a quality of oil for use in the new paper factory which he had built.The oil was delivered but Threads refused to pay for it on the ground that the contract was ultra vires.Atieno, a minority shareholder in Threads Ltd,is now anxious that the company should close down its paper manufacturing business as soon as possible.
i.Advice the supplier of oil whether he may sue Threads Ltd for the price of the oil,or alternatively, recover back the oil itself which has not been used by Threads Ltd. 5mks
ii.Advice Atieno whether she may restrain the company from carrying on the business of paper manufacturers. 5mks
QUESTION FIVE
a.The company Act provides the guidelines with regard to holding company meetings.In this regarding discuss four types of meetings which can be help by companies in compliance with the Company Act. 12mks
b.Explain what you understand by the following terms as applied in company meetings
a) Quorum
b)Service of notice
c)Adjournment
d)Proxy
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