Commerce exams sample papers

CA CPT Exam Mercantile Law Questions with Answers

Mercantile Law question bank

CA CPT Mercantile Law Sample Paper:

Question: After retirement from firm, which of the following partners is not liable by holding out, even if the public notice of retirement is not given?
(a) Active partner
(b) Sleeping partner
(c) Representative of deceased partner
(d) Both (b) and (c)
Ans. (d)

Question: Where the goods are delivered to a carrier or wharfinger for the purpose of transmission to the buyer, the delivery is
(a) Invalid & effective
(b) Valid & effective
(c) Conditional
(d) None
Ans. (b)

Question: Which company shares can be freely transferable?
(a) Private Company
(b) Public Company
Ans. (a)

Question: Cross Offers means
(a) Exchanging iden
tical offers by two parties in ignorance.
(b) Offer made to the public in general.
(c) Offer allowed to remain open for acceptance over a period of time.
(d) Offer made to a definite person.
Ans. (a)

Related: Transfer of Property Act Model Questions

Question: Which of the following offers constitute a valid offer?
(a) An auctioneer displays a TV. set before a gathering in an auction sale.
(b) Ram who is in possession of three cars purchased in different years says ‘I will sell you a car’.
(c) A says to B, “Will you purchase my motor cycle for Rs. 20,000?
(d) All of the above.
Ans. (c)

Question: Impossibility arising subsequent to entering in to a contract is called____
(a) Supervening impossibility
(b) Irregular impossibility
(c) Perpetual impossibility
(d) None
Ans. (a)

Question: The doctrine of indoor management is an ______to the doctrine of constructive notice
(a) Exception
(b) Extension
(c) Alternative
(d) None of the above
Ans. (b)

Question: Age limit of Directors in case of private company is ___
(a) 65
(b) 70
(c) 75
(d) No limit
Ans. (d)

Question: Which of the following agreements is void?
(a) Agreements made under the unilateral mistake of fact.
(b) Agreements made under the bilateral mistake of fact.
(c) Agreements made under the influence of fraud.
(d) Contingent agreement.
Ans. (b)

Question: Contract caused by which of the following is void?
(a) Fraud
(b) Misrepresentation
(c) Coercion
(d) Bilateral Mistake
Ans. (d)

Question: The liability of members if company is limited by shares
(a) Unpaid value of shares
(b) Guarantee amount
(c) Unlimited liability
(d) None of the above
Ans. (a)

Question: Where in a partnership firm the partners are entitled to interest on their capital balance
such interest is payable.
(a) Only out of partners capital
(b) Only out of cash brought in by a new partners towards goodwill
(c) Only out of profits of the firm
(d) None of the above
Ans. (c)

Question: Which of the following is a requirement for misrepresentation to exist?
(a) Misrepresentation should relate to a material fact.
(b) The person making a misrepresentation should not believe it to be true.
(c) It must be made with an intention to deceive the other party.
(d) All of the above.
Ans. (a)

Question: In contract of sale, the goods destroyed after delivery thus risk bears by
(a) The buyer
(b) The seller
(c) Partly by the seller or buyer
(d) Neither buyer Nor seller
Ans. (a)

Question: Suppose the time fixed for performance of the contract has expired but the time is not essential. What is the remedy of the promisee in the circumstances?
(a) Can rescind the contract
(b) To claim compensation
(c) No remedy available
(d) Can’t be determined
Ans. (b)

Question: Mere silence as to fraud likely to affect the willingness of a party to enter into a contract
is not fraud unless.
(a) The circumstances of the case imposed the duty of the person to speak
(b) The circumstances do not show that silence is equivalent to speech
(c) The circumstances such that silence is not fraudulent
(d) Obligations are not imposed by the law
Ans. (a)

Question: Who of the following can be a party to enter into contract?
(a) A convict undergoing sentence
(b) A joint stock company
(c) A minor
(d) All of the above
Ans. (b)

Question: Valid Contract:
(a) In case of this collateral agreements are void
(b) Not enforceable in a court of law
(c) An agreement enforceable by law at the option of one or more of the parties thereon but not at the option of the other or others
(d) Enforceable at the option of both the parties
Ans. (d)


Related: Indian Contract Act Questions / Answers

Question: Which of the following statements is true?
(a) Even if a proposal is not accepted properly it becomes a valid contract.
(b) The agreements which are against the public policy can be enforced if the parties are willing to contract.
(c) A contract can consist of an offer or an acceptance only.
(d) Two are more persons are said to consent when they agree upon the same thing in the same sense.
Ans. (d)

Question: Goods must be the same as wanted by the seller. This is
(a) Condition as to description
(b) Condition as to sample
(c) Condition as to wholesomeness
(d) Condition as to title
Ans. (a)

Question: In which of the following cases, the unpaid seller loses his right of lien?
(a) Delivery of goods to buyer
(b) Delivery of goods to carrier
(c) Tender of price by buyer
(d) All of these
Ans. (d)

Question: Which of the following is a not document of title to goods?
(a) Bill of Lading
(b) Railway Receipt
(c) Dock Warrant
(d) Performa invoice
Ans. (d)

Question: In case of sale of standing trees, the property passes to the buyer when trees are
(a) Felled and ascertained
(b) Not felled but earmarked
(c) Counted and ascertained
(d) Both (b) and (c)
Ans. (a)

Question: Partnership
(a) Arises by operation of law
(b) Comes into existence only after registration
(c) Can arise by agreement or otherwise
(d) Arise by way of an agreement only
Ans. (d)

Question: What is legal terminology for the doing or not doing of something which the promisor desires to be done or not done?
(a) Desires
(b) Wishes
(c) Consideration
(d) Promise
Ans. (c)

Related: Economics General Question Paper

Question: Goods dependant upon certain events which may or may not happen.
(a) Unascertained goods
(b) Future goods
(c) Contingent Goods
(d) Existing Goods
Ans. (c)

Question: The term ‘goods’ for the purpose of Sale of Goods Act, includes
(a) Money
(b) Actionable claims
(c) Growing crops, grass
(d) None of these
Ans. (c)

Question: An unpaid seller can exercise the right of resale
(a) if the goods are of durable nature
(b) if the goods are of perishable
(c) with the consent of buyer
(d) without the consent of buyer
Ans. (b)

Question: X and Y agree to work together as carpenters but X shall receive all profit and shall pay wages to Y. The relation between X and Y is that
(a) Partners
(b) Carpenters
(c) Labourers
(d) Master-Servant
Ans. (d)

Question: Implied contract, even if not in writing or express words, is perfectly ________if other conditions are satisfied
(a) Void
(b) Valid
(c) Voidable
(d) Illegal
Ans. (b)

Question: Which of the following sales is valid?
(a) Sale by mercantile agent.
(b) Sale by one of the Joint owners.
(c) Sale by a person who has possession of goods under a voidable contract but still rescinded.
(d) both (a) & (b).
Ans. (d)

Question: In case of misrepresentation the party who has suffered, can avoid the contract even if he had the means of discovering the truth with ordinary diligence.
(a) true
(b) partly true
(c) totally false
(d) None of the above
Ans. (c)

Question: Which of the following is an essential feature of partnership?
(a) Registration
(b) Test of Mutual Agency
(c) Separate Legal Entity
(d) All of the above
Ans. (b)

A contract cannot be performed by
(a) Parties to the contract
(b) Agents to the parties
(c) Stranger
(d) Promisor
Ans. (c)

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Vishal Arora