Question

Promoters can enter into contracts in the name of the company which is yet to be registered under section 119 of the Corporations Act. These contracts are known as: A. Pre-registration contracts; B. Pre-incorporation contracts C. Contracts binding on the company after registration; D. A & B

Answer 1

The correct answer is B. Pre-incorporation contracts.

Step-by-step explanation:

The correct answer is B. Pre-incorporation contracts.

Pre-incorporation contracts are contracts entered into by the promoters of a company on behalf of the company that is yet to be registered. These contracts are made before the company is officially incorporated and are binding on the company once it is registered.

For example, if a group of individuals wants to start a company but the company is not yet registered, they can enter into contracts with suppliers or lenders using the company's name. These contracts will be considered pre-incorporation contracts.