Question 1

Corporate resolutions of the corporation's board of directors provide guidelines but cannot grant or restrict corporate powers.

Accepted Answer

A) True 
 B)False

Question 2

If the procedures for incorporation are not followed precisely, others may be able to challenge the existence of the corporation.

Accepted Answer

A) True 
 B)False

Question 3

Because a close corporation is one whose shares are held by a relatively small group of persons, the firm often operates like a partnership.

Accepted Answer

A) True 
 B)False

Question 4

Under the business judgment rule, directors cannot be held liable for bad faith, fraud, or a breach of fiduciary duties.

Accepted Answer

A) True 
 B)False

Question 5

All of a certain corporation's small number of shareholders agree that the firm can operate without directors, bylaws, shareholder meetings, stock certificates, and formal records of shareholders' decisions. This firm is most likely

Accepted Answer

A)   a close corporation.
B)   a corporation by estoppel.
C)   a de facto corporation.
D)   a de jure corporation.E) A) and B)
F) C) and D)

Question 6

A corporate director is not liable to the corporation or its shareholders for an honest mistake of judgment.

Accepted Answer

A) True 
 B)False

Question 7

A close corporation need not meet all of the specific requirements set forth in state statutes for corporations because it is essentially a sole proprietorship.

Accepted Answer

A) True 
 B)False

Question 8

To help small businesses raise capital, the Securities and Exchange Commission allows the companies to advertise investment opportunities to the public. This most likely encourages

Accepted Answer

A)   venture capitalizing.
B)   crowdfunding.
C)   piercing the corporate veil.
D)   private equity capitalizing.E) B) and D)
F) All of the above

Question 9

Under the doctrine of respondeat superior, a corporation can be held liable for

Accepted Answer

A)   acts perpetrated by its market competitors.
B)   breaches of contract by its customers and suppliers.
C)   torts committed by its agents or officers.
D)   none of the choices.E) B) and C)
F) A) and B)

Question 10

A corporation's authority to act and its liability for those actions is, with respect to the firm's owners,

Accepted Answer

A)   proportional.
B)   one and the same.
C)   joint and several.
D)   separate and apart.E) B) and D)
F) B) and C)

Question 11

To pierce the corporate veil means to reveal the identity of its true owner.

Accepted Answer

A) True 
 B)False

Question 12

Nile is a holder of preferred stock in Oasis Hotels Inc. Nile

Accepted Answer

A)   has no ownership interest in the corporation.
B)   has priority over holders of common stock as to payment of dividends.
C)   follows common stockholders as to payment on the firm's termination.
D)   has a proportionate interest in the corporation with regard to control.E) All of the above
F) A) and B)

Exam 18: Corporations

A corporate director is not liable to the corporation or its shareholders for an honest mistake of judgment.

Correct Answer
verified

All of a certain corporation's small number of shareholders agree that the firm can operate without directors, bylaws, shareholder meetings, stock certificates, and formal records of shareholders' decisions. This firm is most likely

Correct Answer
verified

If the procedures for incorporation are not followed precisely, others may be able to challenge the existence of the corporation.

Correct Answer
verified

A corporation's authority to act and its liability for those actions is, with respect to the firm's owners,

Correct Answer
verified

Because a close corporation is one whose shares are held by a relatively small group of persons, the firm often operates like a partnership.

Correct Answer
verified

Under the doctrine of respondeat superior, a corporation can be held liable for

Correct Answer
verified

A close corporation need not meet all of the specific requirements set forth in state statutes for corporations because it is essentially a sole proprietorship.

Correct Answer
verified

To help small businesses raise capital, the Securities and Exchange Commission allows the companies to advertise investment opportunities to the public. This most likely encourages

Correct Answer
verified

Under the business judgment rule, directors cannot be held liable for bad faith, fraud, or a breach of fiduciary duties.

Correct Answer
verified

Nile is a holder of preferred stock in Oasis Hotels Inc. Nile

Correct Answer
verified

To pierce the corporate veil means to reveal the identity of its true owner.

Correct Answer
verified

Corporate resolutions of the corporation's board of directors provide guidelines but cannot grant or restrict corporate powers.

Correct Answer
verified

Exam 18: Corporations

A corporate director is not liable to the corporation or its shareholders for an honest mistake of judgment.

Correct AnswerverifiedShow Answer

All of a certain corporation's small number of shareholders agree that the firm can operate without directors, bylaws, shareholder meetings, stock certificates, and formal records of shareholders' decisions. This firm is most likely

Correct AnswerverifiedShow Answer

If the procedures for incorporation are not followed precisely, others may be able to challenge the existence of the corporation.

Correct AnswerverifiedShow Answer

A corporation's authority to act and its liability for those actions is, with respect to the firm's owners,

Correct AnswerverifiedShow Answer

Because a close corporation is one whose shares are held by a relatively small group of persons, the firm often operates like a partnership.

Correct AnswerverifiedShow Answer

Under the doctrine of respondeat superior, a corporation can be held liable for

Correct AnswerverifiedShow Answer

A close corporation need not meet all of the specific requirements set forth in state statutes for corporations because it is essentially a sole proprietorship.

Correct AnswerverifiedShow Answer

To help small businesses raise capital, the Securities and Exchange Commission allows the companies to advertise investment opportunities to the public. This most likely encourages

Correct AnswerverifiedShow Answer

Under the business judgment rule, directors cannot be held liable for bad faith, fraud, or a breach of fiduciary duties.

Correct AnswerverifiedShow Answer

Nile is a holder of preferred stock in Oasis Hotels Inc. Nile

Correct AnswerverifiedShow Answer

To pierce the corporate veil means to reveal the identity of its true owner.

Correct AnswerverifiedShow Answer

Corporate resolutions of the corporation's board of directors provide guidelines but cannot grant or restrict corporate powers.

Correct AnswerverifiedShow Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
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Correct Answer
verified

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verified

Correct Answer
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Correct Answer
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Correct Answer
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