Question 1

When a corporation terminates its existence it must surrender its articles of incorporation.

Accepted Answer

A) True 
 B)False  True

Question 2

A corporation must give notice specifying the subjects to be discussed for a special meeting of shareholders.

Accepted Answer

A) True 
 B)False  True

Question 3

Only stockholders shown by the stockholders' record book have a right to vote.

Accepted Answer

A) True 
 B)False  True

Question 4

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

Accepted Answer

A) True 
 B)False

Question 5

The directors of a corporation 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 6

Explain the two devices used to give minority stockholders a voice on the board of directors. ​

Accepted Answer

The two devices used to give minority st

Question 7

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

Accepted Answer

A) True 
 B)False

Question 8

The officers of a corporation:

Accepted Answer

A) Are the agents of the corporation. 
B) Are selected and removed by the stockholders. 
C) Have their positions specified by federal law. 
D) ​M ust be elected by a two-thirds vote. 
A) Are the agents of the corporation. 
B) Are selected and removed by the stockholders. 
C) Have their positions specified by federal law. 
D) ​M ust be elected by a two-thirds vote.

Question 9

Which of the following is true of a quorum?

Accepted Answer

A) It is the maximum number of proxies that are allowed 
B) Statutes, bylaws, or the articles of incorporation ordinarily require a majority of outstanding stock to constitute a quorum. 
C) A stockholder's proxy cannot be counted in reaching a quorum in a convened meeting. 
D) At common law, a quorum consisted of the number of proxies at a properly convened meeting. 
A) It is the maximum number of proxies that are allowed 
B) Statutes, bylaws, or the articles of incorporation ordinarily require a majority of outstanding stock to constitute a quorum. 
C) A stockholder's proxy cannot be counted in reaching a quorum in a convened meeting. 
D) At common law, a quorum consisted of the number of proxies at a properly convened meeting.

Question 10

Stockholders have the absolute right to inspect the corporation's books.

Accepted Answer

A) True 
 B)False

Question 11

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

Accepted Answer

A) True 
 B)False

Question 12

Stockholders, by virtue of their investment in a corporation, have the right to act as its agent. ​

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

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 15

The dissolution of a corporation:

Accepted Answer

A) Can never be voluntary on the part of stockholders. 
B) May be sought by the state for failure to pay specified taxes for a given number of years 
C) Allows it to make contracts to carry on business for six months. 
D) May require the stockholders to pay debts the corporation's assets cannot cover. 
A) Can never be voluntary on the part of stockholders. 
B) May be sought by the state for failure to pay specified taxes for a given number of years 
C) Allows it to make contracts to carry on business for six months. 
D) May require the stockholders to pay debts the corporation's assets cannot cover.

Question 16

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 document required by law to be in a specified form 
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 document required by law to be in a specified form

Question 17

Which of the following best describes a preemptive right?

Accepted Answer

A) It is the right to purchase additional stock on 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 new capital stock in proportion to shares owned. 
A) It is the right to purchase additional stock on 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 new capital stock in proportion to shares owned.

Question 18

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

Accepted Answer

A) True 
 B)False

Question 19

Which of the following is true of a corporation?

Accepted Answer

A) It is an artificial being, existing only in contemplation of law. 
B) Shareholders of a corporation 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) Shareholders of a corporation 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 20

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 right 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 right 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.

Exam 34: Management and Dissolution of a Corporation

When a corporation terminates its existence it must surrender its articles of incorporation.

A corporation must give notice specifying the subjects to be discussed for a special meeting of shareholders.

Only stockholders shown by the stockholders' record book have a right to vote.

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

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

Explain the two devices used to give minority stockholders a voice on the board of directors. ​

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

The officers of a corporation:

Which of the following is true of a quorum?

Stockholders have the absolute right to inspect the corporation's books.

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

Stockholders, by virtue of their investment in a corporation, have the right to act as its agent. ​

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

Which of the following best describes whistleblowers?

The dissolution of a corporation:

Which of the following best describes a proxy?

Which of the following best describes a preemptive right?

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

Which of the following is true of a corporation?

Which of the following is an example of cumulative voting?

Introduction to Law

Courts and Court Procedures

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 Contracts

Warranties Product Liability and Consumer Protection

Nature of Negotiable Instruments

Essentials of Negotiability

Promissory Notes and Drafts

Negotiation and Discharge

Liabilities of Parties, Holders in Due Course and Defenses

Nature and Creation of an Agency

Operation and Termination of an Agency

Employer and Employee Relations

Employees Rights

Introduction to Business Organizations

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 Trust

Filters

Explain the two devices used to give minority stockholders a voice on the board of directors.

Stockholders, by virtue of their investment in a corporation, have the right to act as its agent.