AfirmnamedScientificDiscoveryCorporationSDCmakesanattemptto

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Business: Its Legal, Ethical, and Global Environment
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Chapter 11 / Exercise 10
Business: Its Legal, Ethical, and Global Environment
Jennings
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10. A firm named Scientific Discovery Corporation (SDC) makes an attempt to  incorporate for a purpose other than making a profit. SDC is a. a foreign corporation. b. an alien corporation. c. a nonprofit corporation. d. not a corporation. ANSWER: C PAGE: 771 TYPE: N
NAT: AACSB Reflective LOC:  AICPA Critical Thinking 11. Ruby Red Corporation has six shareholders, four of whom are members of  the same family. All of Ruby’s shareholders agree in writing to operate  without   shareholders’   meetings.   Under   the   Revised   Model   Business  Corporation Act, this most likely warrants PAGE: 771 TYPE: N
NAT: AACSB Reflective LOC:  AICPA Legal 12. Eternal Ovens, Inc., is a private, for-profit corporation that (1) was formed  for the purpose of manufacturing and distributing a newly patented kitchen  appliance,   (2)   is   owned   by   five   shareholders,   (3)   is   subject   to   double  taxation, and (4) has made no public offering of its shares. Dependable is PAGE: 771 TYPE: =
NAT: AACSB Reflective LOC:  AICPA Legal 13. Convenience Mart, Inc., is a close corporation. Convenience Mart is
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The document you are viewing contains questions related to this textbook.
Business: Its Legal, Ethical, and Global Environment
The document you are viewing contains questions related to this textbook.
Chapter 11 / Exercise 10
Business: Its Legal, Ethical, and Global Environment
Jennings
Expert Verified
CHAPTER 32: CORPORATE FORMATION AND FINANCING            257 d. taxed in the same manner as a partnership. ANSWER: C PAGE: 771 TYPE: = NAT: AACSB Reflective LOC:  AICPA Legal
258           UNIT SIX: BUSINESS ORGANIZATIONS 14. Boutique Corporation would like to change its corporate status to avoid in- come taxes at the corporate level. To qualify, the shareholders must  not  be a. corporations. b. estates. c. individuals. d. partnerships. ANSWER: D PAGE: 773 TYPE: =
NAT: AACSB Reflective LOC:  AICPA Legal 15. Frida and Gregor want to establish a corporation to market a new line of  fishing gear. To avoid income taxes at the corporate level, they should form PAGE: 773 TYPE: N
NAT: AACSB Reflective LOC:  AICPA Risk Analysis 16. Jim and Kiley are architects and shareholders of J&K, P.C., a professional  corporation. Jim supervises Luc, an employee of the firm. As a shareholder,  Jim PAGE: 774 TYPE: =
NAT: AACSB Reflective LOC:  AICPA Legal

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