Class 11 Business Studies — Chapter 7: FORMATION OF A COMPANY

What you'll learn

• ▸Stages of Company Formation
• ▸Promotion and the Role of a Promoter
• ▸Feasibility Studies
• ▸Company Name Approval
• ▸Key Documents for Incorporation
• ▸Memorandum of Association (MoA)
• ▸Signatories to the Memorandum

Chapter Summary

--- PAGE 1 --- PART-II Corporate Organisation, Finance and Trade © NOT TO BE REPUBLISHED Reprint 2025-26 --- PAGE 2 --- CHAPTER 7 FORMATION OF A COMPANY LEARNING OBJECTIVES After studying this chapter, you should be able to: * specify the important stages in the formation of a company; * describe the steps involved in each stage of company formation; * specify the documents to be submitted to the registrar of companies; and * state the need of certificate of incorporation and certificate to commence business. Reprint 2025-26 --- PAGE 3 --- FORMATION OF A COMPANY 153 Avtar, a brilliant automobile engineer, has recently developed a new carburettor in his factory which he is running as a sole proprietor. The new carburettor can cut down petrol consumption of a car engine by 40 percent. He is now thinking of producing it on a large scale for which he requires a large amount of money. He is to evaluate different forms of organisations for doin…

Practice Questions from this Chapter

Tap "Get Solution" on any question to ask our AI tutor.

1. Explain company formation steps simply. Get Solution →
2. Define a company promoter clearly. Get Solution →
3. List reasons to start a company. Get Solution →
4. According to the text, what are the three distinct stages in the formation of a company? Get Solution →
5. What is the term for the person or group of persons who take the initiative to form a company? Get Solution →
6. What is the very first stage in the formation of a company? Get Solution →
7. Which document is described as the most important because it defines the objectives of the company? Get Solution →
8. Which clause within the Memorandum of Association defines the purpose for which the company is formed? Get Solution →

Did you know?

• 💡 The Dutch East India Company, founded in 1602, was the first publicly traded company.
• 💡 Many huge companies, like Apple, started in a small garage with just one idea.
• 💡 The oldest existing company in the world started over 1400 years ago in Japan.
• 💡 Some places let you register a new company almost entirely online in just minutes.
• 💡 Companies need 'capital' which is money and resources to grow their big ideas.

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