Question

One out of the below mentioned statements is false. Pick the correct option.

• A. A registered company whose members have a liability limited, at the time of winding up of company their liability becomes unlimited.
• B. A publicly owned .company is a company whose shares are held by public.
• C. When companies shares are held by individuals who are associated with the management of firm it is closely held company.
• D. When a company goes public its true market value is revealed

Answer 1

The correct option is A A registered company whose members have a liability limited, at the time of winding up of company their liability becomes unlimited.

For Companies limited by shares or limited by guarantee, the extent of liability is determined by the face value of shares they poses or the value up to which they have extended the guarantee. Therefore, liabilities of the member will still be limited in case of winding up.