Final - Business Law II Corporations Multiple Choice...

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Business Law II Corporations Multiple Choice Identify the choice that best completes the statement or answers the question. ____ 1. Federal Home Products, Inc. (FHP), is a corporation. The implied powers of FHP are powers necessary to a. amend the corporate charter. b. bring a derivative suit. c. declare dividends. d. perform all acts reasonably appropriate and necessary to accomplish its corporate purposes. ____ 2. Eve and Fran want to market a new line of cooking appliances. To avoid income taxes at the corporate level, they should form a. a C corporation. b. a close corporation. c. an S corporation. d. a private corporation. ____ 3. As a promoter for ABC Enterprises Corporation, Bruce would not a. buy land for corporate offices. b. issue ABC stock. c. order stationery for ABC. d. solicit subscriptions for ABC stock. ____ 4. Jean and Nathan want to incorporate to market DVD products. The first step in the incorporation procedure is to a. file the articles of incorporation. b. hold the first organizational meeting. c. obtain a corporate charter. d. select a state in which to incorporate. ____ 5. Like the bylaws of other corporations, the bylaws of Consumer Products, Inc., a. establish the operating name of the corporation. b. establish the value and classes of corporate stock. c. were adopted at its first organizational meeting. d. were submitted for approval to the public official in charge. ____ 6. Alpha Corporation substantially complies with all conditions precedent to incorporation. Alpha has a. de facto existence. b. de jure existence. c. ultra vires existence. d. none of the above. ____ 7. Ira tricks Janet into believing that Ace Distributing Corporation is an existing corporation. Janet signs a contract that is not performed by Ace. In Janet’s suit against Ace, a court will likely recognize Ace as a. a corporation by estoppel. b. a de facto corporation. c. a de jure corporation. d. none of the above. ____ 8. Sam is a shareholder of Urban Sales, Inc (USI). A court might hold Sam personally liable for USI’s debts if
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a. Sam’s personal interests are commingled with USI’s interests to the extent that USI has no separate identity. b. USI calls more than the required number of shareholders’ meetings. c. USI is overcapitalized. d. any of the above. ____ 9. Eve and Fred are holders of common stock in Green Grocers, Inc. (GGI). Like other holders of common stock, they may be said to have a residual position in the overall financial structure of GGI, because they a. are entitled to a dividend not received by other classes of shareholders. b. are the last to receive payment for their investment. c. have first priority to any assets of the company if it becomes insolvent. d.
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Final - Business Law II Corporations Multiple Choice...

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