State which of the following combination of statements are true about the Company?

(A) A company is an artificial person.

(B) Capital reserves are created from capital profits.

(C) Shareholders of a company are liable for the acts of the company.

(D) A company's shares are generally transferable.

Choose the correct answer from the options given below:

(A), (B) and (D) only

The correct answer is option 1- (A), (B) and (D) only.

(A) A company is an artificial person.  IT IS TRUE. The company being an artificial person created by law continues to exist irrespective of the changes in its membership. A company can be terminated only through law. The death or insanity or insolvency of any member of the company in no way affects the existence of the company. Members may come and go but the company continues. 

(B) Capital reserves are created from capital profits. IT IS TRUE. Capital reserve is a type of reserve account created from profits generated from non-operating activities like the sale of assets, revaluation of assets, or premiums received on the issue of shares.

(C) Shareholders of a company are liable for the acts of the company. IT IS NOT TRUE.  The liability of the members of the company is limited to the extent of unpaid amount of the shares held by them.

(D) A company's shares are generally transferable. IT IS TRUE. The shares of a public limited company are freely transferable. The permission of the company or the consent of any member of the company is not necessary for the transfer of shares. But the Articles of the company can prescribe the manner in which the transfer of shares will be made.