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Free BA4 Exam Braindumps
BA4 - Fundamentals of Ethics, Corporate Governance and Business Law Questions 101–105 (page: 22)

Updated On: 9-Feb-2026
Page 22 of 102
PDF with 661 Questions

X Ltd has entered into a number of contracts with Y Ltd. In which of the following situations could the directors be held personally liable for the debts contracted with Y Ltd?

(i) X Ltd has continued to trade at a time when insolvency appeared inevitable

(ii) X Ltd has become insolvent and is unable to pay its debts to Y Ltd

(iii) X Ltd has contracted for a purpose not specified in its articles of association

  1. (i) only
  2. (i) and (ii) only
  3. (ii) only
  4. (iii) only

Answer(s): A



Which of the following is incorrect in relation to the criminal law?

  1. All criminal cases commence in the Magistrates' Court.
  2. The purpose of the criminal law is to regulate behavior within society by punishment and deterrence.
  3. A crime is regarded as an offence against society as a whole and the state will prosecute the offender on its behalf.
  4. A breach of contract is a criminal offence.

Answer(s): D



Which of the following is correct?

  1. A contract is frustrated when something happens, after it has been entered into, which renders the contract more difficult to perform.
  2. A contract is frustrated when something happens, after it has been entered into, which renders the contract impossible to perform.
  3. A contract is frustrated when a party expressly agrees to manufacture and supply goods and then discovers that they will be far more expensive to produce than they thought at the time of the contract.
  4. A contract is frustrated if it is impossible to perform at the time that it is made.

Answer(s): A



In 2011 Exe Bank plc granted a loan of £200,000 to Wye Ltd secured by a fixed charge over the company's land and a floating charge over all the company's other assets. Wye Ltd remains solvent but has now failed to meet its monthly repayments for three months.

Which of the following options are available to Exe Bank plc?

(i) Sue Wye Ltd for breach of contract.

(ii) Appoint an administrator

(iii) Petition for the compulsory winding up of Wye Ltd.

  1. (i) only
  2. (ii) only
  3. (i) and (ii) only
  4. (i), (ii) and (iii)

Answer(s): D



Exe Ltd was under contract to deliver goods by road to London for Wye Ltd for £2,000. After part of the journey was completed the lorry broke down and Wye Ltd was forced to arrange for Zed Ltd to complete the delivery. Subject to the contract not providing for this situation, which of the following is correct?

  1. Exe Ltd is entitled to part of the delivery fee.
  2. Exe Ltd is entitled to nothing.
  3. Exe Ltd is entitled to a reasonable sum for the work done.
  4. Exe Ltd is entitled to the full £2,000.

Answer(s): B



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