Question 1

When a corporation is dissolved:

Accepted Answer

A)  it can issue capital stock to existing shareholders. 
B)  it can continue to sue third-parties and other organizations. 
C)  it can form contracts for the purpose of converting assets into cash. 
D)  it can transfer property to other corporations. 
A)  it can issue capital stock to existing shareholders. 
B)  it can continue to sue third-parties and other organizations. 
C)  it can form contracts for the purpose of converting assets into cash. 
D)  it can transfer property to other corporations. C

Question 2

Explain any three rights of stockholders.

Accepted Answer

The stockholders of a corporation enjoy several important rights and privileges and they are as follows: 1. A stockholder has the right to receive a properly executed certificate as evidence of ownership of shares of stock
2. A stockholder has the right to attend corporate meetings and to vote unless this right is denied by express agreement, the articles of incorporation, or statutory provisions
3. A stockholder has the right to receive a proportionate share of the profits when profits are distributed as dividends.

Question 3

The directors of a corporation as a group act as fiduciaries.

Accepted Answer

A) True 
 B)False  True

Question 4

Each stockholder has two votes for each share of common stock owned.

Accepted Answer

A) True 
 B)False

Question 5

As fiduciaries of the corporation, directors incur liability for losses when they are caused by bad faith.

Accepted Answer

A) True 
 B)False

Question 6

Which of the following is true of a corporation?

Accepted Answer

A)  It is an artificial being, existing only in contemplation of law. 
B)  Directors of a corporation as a group do not represent the corporation as agents. 
C)  Stockholders perform all the administrative functions of the corporation. 
D)  Stockholders directly control the day to day activities of a corporation. 
A)  It is an artificial being, existing only in contemplation of law. 
B)  Directors of a corporation as a group do not represent the corporation as agents. 
C)  Stockholders perform all the administrative functions of the corporation. 
D)  Stockholders directly control the day to day activities of a corporation.

Question 7

A merger occurs when two corporations combine to form a new corporation.

Accepted Answer

A) True 
 B)False

Question 8

Which of the following best describes a proxy?

Accepted Answer

A)  A person authorized to vote for another 
B)  A person who relinquishes his right to vote 
C)  A person authorized to sell the company's stock 
D)  A person authorized to act as another's agent in buying transactions 
A)  A person authorized to vote for another 
B)  A person who relinquishes his right to vote 
C)  A person authorized to sell the company's stock 
D)  A person authorized to act as another's agent in buying transactions

Question 9

Stockholders cannot carry out a motion to elect a new board of directors.

Accepted Answer

A) True 
 B)False

Question 10

A corporation may terminate its existence before surrendering its articles of incorporation.

Accepted Answer

A) True 
 B)False

Question 11

A _____ of two corporations occurs when they combine so that one survives and the other ceases to exist.

Accepted Answer

A)  dissolution 
B)  merger 
C)  buyout 
D)  consolidation 
A)  dissolution 
B)  merger 
C)  buyout 
D)  consolidation

Question 12

The directors of an organization do not have the power to delegate authority to any of its members to act for the corporation.

Accepted Answer

A) True 
 B)False

Question 13

Attempts by competing sides to secure majority of stockholders' votes are known as proxy wars.

Accepted Answer

A) True 
 B)False

Question 14

A stockholder has the right to receive a proportionate share of the profits when profits are distributed as dividends.

Accepted Answer

A) True 
 B)False

Question 15

A foreign corporation whose authority to do business in the state has been revoked is allowed to form contracts.

Accepted Answer

A) True 
 B)False

Question 16

Which of the following best describes preemptive rights?

Accepted Answer

A)  It is the right to purchase additional stock from the stock exchange. 
B)  It is the right to sell existing shares back to the corporation. 
C)  It is the right to purchase shares before the incorporation of a company. 
D)  It is the right to purchase fresh capital stock in proportion to shares owned. 
A)  It is the right to purchase additional stock from the stock exchange. 
B)  It is the right to sell existing shares back to the corporation. 
C)  It is the right to purchase shares before the incorporation of a company. 
D)  It is the right to purchase fresh capital stock in proportion to shares owned.

Question 17

Which of the following best describes whistleblowers?

Accepted Answer

A)  They are people who take part in insider trading activities. 
B)  They are a group of people engaged in stock taxation. 
C)  They are people who expose wrongdoing in an organization. 
D)  They are people who subscribe for fresh capital stock. 
A)  They are people who take part in insider trading activities. 
B)  They are a group of people engaged in stock taxation. 
C)  They are people who expose wrongdoing in an organization. 
D)  They are people who subscribe for fresh capital stock.

Question 18

Which of the following is an example of cumulative voting?

Accepted Answer

A)  Dan and Ben own ten shares together and two directors are to be elected, so they receive the right to cast 12 votes. 
B)  Dan owns two shares and two directors are to be elected, but he receives no rights to cast a vote. 
C)  Dan owns six shares and two directors are to be elected, so he receives the right to cast six votes. 
D)  Dan owns ten shares, and five directors are to be elected, so he receives the right to cast 50 votes. 
A)  Dan and Ben own ten shares together and two directors are to be elected, so they receive the right to cast 12 votes. 
B)  Dan owns two shares and two directors are to be elected, but he receives no rights to cast a vote. 
C)  Dan owns six shares and two directors are to be elected, so he receives the right to cast six votes. 
D)  Dan owns ten shares, and five directors are to be elected, so he receives the right to cast 50 votes.

Question 19

The board of directors is the primary policy-making body of the corporation.

Accepted Answer

A) True 
 B)False

Question 20

Which of the following is true of a quorum?

Accepted Answer

A)  Statutes, bylaws, or the articles of incorporation enable voting proxy in a quorum. 
B)  It is a maximum number of debentures that must be represented in order that business may be lawfully transacted. 
C)  A stockholder's proxy cannot vote on his behalf in a convened meeting. 
D)  Under the common law, a quorum consists of the stockholders represented by proxy at a properly convened meeting. 
A)  Statutes, bylaws, or the articles of incorporation enable voting proxy in a quorum. 
B)  It is a maximum number of debentures that must be represented in order that business may be lawfully transacted. 
C)  A stockholder's proxy cannot vote on his behalf in a convened meeting. 
D)  Under the common law, a quorum consists of the stockholders represented by proxy at a properly convened meeting.

Exam 36: Management and Dissolution of a Corpora

When a corporation is dissolved:

Explain any three rights of stockholders.

The directors of a corporation as a group act as fiduciaries.

Each stockholder has two votes for each share of common stock owned.

As fiduciaries of the corporation, directors incur liability for losses when they are caused by bad faith.

Which of the following is true of a corporation?

A merger occurs when two corporations combine to form a new corporation.

Which of the following best describes a proxy?

Stockholders cannot carry out a motion to elect a new board of directors.

A corporation may terminate its existence before surrendering its articles of incorporation.

A _____ of two corporations occurs when they combine so that one survives and the other ceases to exist.

The directors of an organization do not have the power to delegate authority to any of its members to act for the corporation.

Attempts by competing sides to secure majority of stockholders' votes are known as proxy wars.

A stockholder has the right to receive a proportionate share of the profits when profits are distributed as dividends.

A foreign corporation whose authority to do business in the state has been revoked is allowed to form contracts.

Which of the following best describes preemptive rights?

Which of the following best describes whistleblowers?

Which of the following is an example of cumulative voting?

The board of directors is the primary policy-making body of the corporation.

Which of the following is true of a quorum?

Introduction to Law

Courts and Court Procedure

Business Torts and Crimes

Government Regulation of Business

Nature and Classes of Contracts

Offer and Acceptance

Capacity to Contract

Consideration

Defective Agreements

Illegal Agreements

Written Contracts

Third Parties and Contracts

Termination of Contracts

Nature of Personal Property

Special Bailments

Sales of Personal Property

Formalities of a Sale

Transfer of Title and Risk in Sales Con

Warranties, Product Liability, and Cons

Nature of Negotiable Instruments

Essentials of Negotiability

Promissory Notes and Drafts

Negotiation and Discharge

Liabilities of Parties and Holders in Due Course

Defenses

Nature and Creation of an Agency

Operation and Termination of an Agency

Employer and Employee Relations

Employees Rights

Labor Legislation

Introduction to Business Organization

Creation and Operation of a Partnership

Dissolution of a Partnership

Nature of a Corporation

Ownership of a Corporation

Principles of Insurance

Types of Insurance

Security Devices

Bankruptcy

Nature of Real Property

Transfer of Real Property

Real Estate Mortgages

Landlord and Tenant

Wills, Inheritances, and Trusts

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