Business Law Text & Cases Commercial Law for Accountants 14th Edition by Roger LeRoy Miller - Test Bank Instant Download - Complete Test Bank With Answers Sample Questions Are Posted Below True / False 1. A corporation possesses the same right of access to the courts as a citizen. a. …
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Business Law Text & Cases Commercial Law for Accountants 14th Edition by Roger LeRoy Miller – Test Bank
Instant Download – Complete Test Bank With Answers
Sample Questions Are Posted Below
| True / False |
1. A corporation possesses the same right of access to the courts as a citizen.
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2. The corporation is a creature of statute.
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3. One of the key advantages of the corporate form is the unlimited liability of its owners.
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4. The state can dissolve a corporation for failing to pay taxes.
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5. A corporation is not liable for the misconduct of its agents, officers, or employees.
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6. A corporate director “owns” the corporation.
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7. The board of directors makes corporate policy decisions.
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8. An alien corporation is a corporation formed by a local corporation’s competitor.
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9. The U.S. Postal Service is a public corporation.
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10. A corporation cannot be formed for purposes other than making a profit.
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11. A foreign corporation normally does not need a certificate of authority to sell goods or services via the Internet.
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12. A publicly held corporation is any corporation whose shares are publicly traded in a securities market.
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13. A corporation whose shares are held by relatively few persons is a close corporation.
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14. In many states, close corporations have more flexibility in determining their rules of operation.
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15. An agreement between shareholders can restrict the transfer of a close corporation’s stock.
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16. If a corporation has S corporation status, it must pay income taxes at the corporate level.
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17. The articles of incorporation serve as a primary source of authority for a corporation’s business functions.
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18. Selecting the state in which to incorporate is an important step in the incorporation procedure.
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19. The purpose of a corporation may not be specified in its articles of incorporation.
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20. A corporation does not have perpetual existence in most states unless the articles of incorporation state otherwise.
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21. Bylaws are the internal rules of management for a corporation.
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22. Express powers of a corporation can be found in state corporation statutes.
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23. In the absence of express constitutional, statutory, or other provisions, the corporation has no implied powers.
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24. In corporate law, acts of a corporation that are beyond its express or implied powers are de facto acts.
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25. A de jure corporation is one that is formed for a single purpose.
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26. A business that holds itself out as being a corporation may not be able to deny corporate status, even if it makes no attempt to incorporate.
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27. To pierce the corporate veil means to reveal the identity of its true owner.
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28. In certain instances of fraud, a court may “pierce the corporate veil” to hold the shareholders individually liable.
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29. One factor that frequently causes the courts to pierce the corporate veil is that a corporation was set up never to make a profit.
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30. A court will pierce the corporate veil of a corporation when the corporate privilege is abused for personal benefit.
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31. The date when the principal of a bond is returned to the investor is the maturity date.
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32. Stocks represent the borrowing of funds by firms.
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33. The true ownership of a corporation is represented by common stock.
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34. Preferred stock is an equity security with preferences.
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35. Venture capital is capital provided to new business ventures by professional, outside investors.
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| Multiple Choice |
36. Ned and Olsen want to form and do business as a corporation—Pastries & Pies Inc. Its existence depends generally on
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37. Dennis and Eve want to form and do business as a corporation—Farm-2-Fork Inc. A corporation is
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38. Rita and Susan want to form and do business as Trips & Travel, Inc. They will serve as the firm’s directors and officers, and will initially hold all of the stock in the company. A corporation is owned by
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39. Allen wants Wilderness Outfitters to join with him to form and do business as Canyon River Rafting Corporation. A corporation can be owned by
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40. Ida and Jay are the shareholders and the directors of Keystone Property Management Inc. Lily and Mike are Keystone officers. The responsibility for the overall management of this firm rests with
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41. Sean is the incorporator of Twisty’s Pretzels Corporation. Ross is a shareholder, Phyllis is a director, and Velma is an officer. The day-to-day operations of Twisty’s are overseen by
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42. Finn and Glenda want to form and do business as Hobby Crafts Corporation. A corporation is
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43. Ruby Red Corporation is incorporated in South Carolina. In that state, Ruby Red is
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44. Dollars & Sense, Inc., is incorporated in the state of New Jersey and is doing business in the state of New York. In New York, Dollars & Sense is properly referred to as
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45. Wiley incorporates his business as Wiley’s Wire Inc. in Arizona. He and his group of shareholders intend to make a profit from their sales of fencing wire. Wiley’s is
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46. The incorporation of the town of Halfway, Oregon, is approved by the state. Halfway is
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47. The shares of Home Mortgage Corporation are publicly traded in securities markets. Home Mortgage Corporation is
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48. A firm named Biometric Research makes an attempt to incorporate for a purpose other than making a profit. Biometric is
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49. Bay City Merchants Corporation has six shareholders, four of whom are members of the same family. All of Bay City’s shareholders agree in writing to operate without shareholders’ meetings. Under the Revised Model Business Corporation Act, this most likely warrants
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50. Integrated Devices, Inc., is a private, for-profit corporation that is owned by five shareholders who are members of the same family. Integrated is
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51. Harry and Ilene want to market a new line of kayaks and related gear under the brand name Journeys as a corporation—Journeys Inc. To avoid income taxes at the corporate level, they should form
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52. The abbreviation “P.A.” in the name “Conrad & Drake, Accountants, P.A.” means that this organization is
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53. Pro Audio, Inc., would like to change its corporate status to that of an S corporation. To qualify, Pro Audio must
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54. Boutique Bodega Corporation would like to change its corporate status to that of an S corporation. To qualify, the shareholders must not be
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55. Flo and Glen form Health Food Inc. to coordinate the purchase, sale, and delivery of food products from organic farms to hospitals and other institutions. The stated purpose is to make a profit and to have a material positive impact on society and the environment. Health Food is
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56. Burgers & Brews, Inc., files its articles of incorporation with the appropriate government agency. Not likely to appear in the articles is the name of
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57. Like the bylaws of other corporations, the bylaws of Rocks, Paper & Scissors, Inc.,
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58. Ben incorporates his app business as Clickology, Inc. Under most state corporation statutes, Clickology can have
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59. Jen and Kay would like to form Lunch Garden, Inc., to enter the food vending business. Most likely, the articles of incorporation for the firm will not include
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60. Owen is a registered agent for Pods & Phones, Inc., which incorporated in California. As a registered agent, Owen
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61. Equestrian Stables Corporation’s articles list an incorrect address for its incorporator. Under this circumstance, Equestrian Stables is most likely
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62. EZ Hauling holds itself out to customers as being a corporation but makes no attempt to incorporate. In this circumstance, EZ Hauling is most likely
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63. Wings2Go Corporation fails to hold an organizational meeting. In this circumstance, Wings2Go is most likely
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64. Hollywood Lights, Inc. substantially complies with all conditions precedent to incorporation. Hollywood is most likely
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65. Tech Talent, Inc., is a corporation. Techno Talent’s implied powers enable it to
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66. Rob owns Solar Panels Corporation. He uses Solarl’s funds to pay his personal expenses, creates Thermal Power Inc. to engage in the same business as Solar, transfers Solar’s assets to Thermal, and petitions Solar into bankruptcy. This most likely warrants
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67. Interstate Paving, Inc., issues bonds. Bonds
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68. Vince buys 500 shares of common stock in Water Services, Inc. As a shareholder of record, Vince owns a proportionate interest with regard to Water’s
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69. Blair and Chanel are holders of common stock in Discount Retail Stores, Inc. Like other holders of common stock, they have a residual position in the overall financial structure of Discount Retail, because they
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70. Sierra is a holder of preferred stock in Rio Grande Irrigation, Inc. Sierra has priority over holders of Rio common stock as to
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| Essay |
71. Agents and employees of Deco Arts Corporation and Echo Imitations Inc. are convicted of conspiring to violate a federal law that is punishable by a term of imprisonment and a fine. Can the corporations be held liable for these crimes? If so, how can they be punished?
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72. PrimarySource.com Corporation is a new online, textbook, and school supply business. How can PrimarySource.com obtain capital to finance its operations?
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