MCQ on Buy Back of Shares: Check the below Corporate and Management Accounting MCQ on Buy Back of Shares with Answers Pdf free download. Corporate and Management Accounting MCQ on Buy Back of Shares Questions for Corporate and Management Accounting with Answers were prepared based on the latest exam pattern. We have provided Corporate and Management Accounting MCQ on Buy Back of Shares with Answers to help students understand the concept very well. Students should practice CS Executive MCQ on Buy Back of Shares Questions with Answers based on the latest syllabus.

MCQ on Buy Back of Shares

1. Provisions of Section 68 relating to buy-back of shares are applicable to –
(A) Private companies
(B) Public companies
(C) Listed companies
(D) All of the above

2. As per Section 68 of the Companies Act, 2013, the post-buy-back debt-equity ratio should not exceed –
(A) 1
(B) 1.5
(C) 2
(D) 3

3. For the purpose of calculating the debt-equity ratio which of the following debts are considered –
(A) Secured debts
(B) Unsecured debts
(C) Current liabilities
(D) All of the above

4. No company shall purchase its own shares or other specified securities unless buy-back is authorized by its –
(A) Memorandum of Association
(B) Registrar of Companies
(C) Shareholders agreement
(D) Article of Association

5. Provisions relating to buying back securities are contained in the Companies Act, 2013.
(A) Section 77
(B) Section 77A
(C) Section 68
(D) Section 63

6. Declaration of solvency in relation to buyback of shares has to be filed in
(A) Form SH-6
(B) Form SH-9
(C) Form SH-4
(D) Form SH-8

7. Companies are allowed to buy back shares which are:
(A) Partly paid-up
(B) Fully paid-up
(C) Partly paid-up or fully paid-up at the option of the company
(D) Fully paid-up and partly paid-up with the permission of Central Government

8. The maximum permissible buy-back under the Companies Act, 2013 is
(A) 10% of paid-up capital with Board resolution
(B) 25% of paid-up capital with Board resolution
(C) 25% of the aggregate of paid-up capital and free reserves of the company with a special resolution of shareholders
(D) 25% of the aggregate of paid-up capital and free reserves of the company with an ordinary resolution of shareholders

9. Where a company buys back its own shares or other specified securities, it shall extinguish and physically destroy the shares or securities so bought back within the last date of completion of buy-back.
(A) 3 days
(B) 8 days
(C) 7 days
(D) 9 days

10. Section 68 of the Companies Act, 2013 provides that no buy-back of any kind of shares or other specified securities shall be made out of the
(A) Securities premium balance as it stood before buy-back
(B) Proceeds of an earlier issue of the same kind of shares or same kind of other specified securities
(C) General reserve in excess of 15% balance as per latest audited balance sheet
(D) Proceeds of issue of specified securities

11. Where a company proposes to buy-back its own shares or other specified securities, it shall, before making such buy-back, file with the ROC and the SEBI, a declaration of solvency signed by –
(A) at least 2 directors of the company, one of whom shall be the managing director
(B) at least 2 directors, managing director, and Chief Financial Officer, if any
(C) at least 2 directors of the company and Company Secretary, if any
(D) at least 3 directors of the company, one of whom shall be the managing director

12. Buy-back of equity shares in any financial year should not exceed –
(A) 10% of net worth
(B) 25% of the aggregate of paid-up capital and free reserves of the company
(C) 25% of the paid-up equity capital
(D) 25% of the aggregate of paid-up equity capital and preference capital

13. Which of the following is allowed within the next 6 months after the buyback of share?
(A) Bonus issue
(B) Conversion of warrants
(C) Stock option schemes
(D) All of the above

14. Which of the following is allowed within the next 6 months after the buyback of share?
(A) Stock option schemes
(B) Sweats equity
(C) Conversion of preference shares or debentures into equity shares
(D) All of the above

15. For buy-back up to of the company, Board resolution is sufficient.
(A) 10% of paid-up capital
(B) 10% of free reserves
(C) 10% of paid-up capital or free reserves
(D) 10% of paid-up capital and free reserves

16. Where a company completes a buyback of its shares or other specified securities, it shall not make a further issue of the same kind of shares or other securities including allotment of new shares u/s 62 (1)(a) [i.e. right issue] or other specified securities within a period of –
(A) 6 months
(B) 1 year
(C) 2 years
(D) 10 months

17. No offer of buy-back shall be made within a period of reckoned from the date of the closure of the preceding offer of buy-back
(A) 6 months
(B) 1 year
(C) 2 years
(D) 10 months

18. No company shall purchase its own shares or other specified securities unless buy-back is authorized by its –
(A) Memorandum of Association
(B) Registrar of Companies
(C) Shareholders agreement
(D) Article of Association

19. The notice of the meeting at which the special resolution is proposed to be passed relating to buy-back of shares shall be accompanied by an explanatory statement stating
(A) Full and complete disclosure of all material facts
(B) Analysis of debt-equity
(C) Gross profit ratio before buy-back
(D) Chairman’s view on buy-back

20. The buy-back of the shares or other specified securities listed on any recognized stock exchange is in accordance with the –
(A) SEBI (Buy-Back of Securities) Regulations, 2018
(B) SEBI (Buy-Back of Securities) Regulations, 2014
(C) SEBI (Buy-Back of Securities) Regulations, 1992
(D) SEBI (Buy-Back of Securities) Regulations, 1994

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By Team Learning Mantras