Question 1

In a company one of the major effects of incorporation is that:

(a) the shareholders will always be liable for all debts of the company

(b)the directors will always be liable for all debts of the company

(c)the company becomes a separate legal entity

(d)the company no longer has perpetual succession

(e) the members control the company Question 2 The case of Gilford Motor Co Ltd v Horne is an example of: (a) the doctrine of separate legal entity (b) members controlling the company (c) a pre-incorporation contract (d) lifting the corporate veil (e) the Salomon principle Question 3 According to s. 198A of the Corporations Act 2001 (Cth) (a) directors have the power to manage the company (b) directors must follow the directions of the members (c) directors must follow the directions of external controllers (d) promoters have the power to manage the company until the first Annual General Meeting (e) shareholders control the company Question 4 The duty to prevent insolvent trading is found in the following section of the Corporations Act 2001 (Cth) (a) s. 180 (b) s. 183 (c) s. 191 (d) s. 588G (e) s. 1317E Question 5 The duty to act with care skill and diligence (a) is a fiduciary duty (b) corresponds to s.181 of the Corporations Act (c) is a common law duty (d) corresponds to s. 183 of the Corporations Act (e) is a criminal penalty provision