stud
bud
Sign up
Log in
Home
Library
Explore
SAT
More
Corporate Law Final Exam Review Flashcards | StudBud
Explore
/
Corporate Law Final Exam Review
Corporate Law Final Exam Review
82 terms
·
StudBud Administration
·
7 plays
Imported from external platform
Flashcards
82 cards
F
Practice quiz
P
Host live
L
Questions
82
Answers
1
Limited partners are granted the same rights as general partners of a general partnership.
True
False
2
The proper documentation must be filed with the secretary of state to elect limited liability partnership status.
False
True
3
An agency relationship may NOT be created
without the principal's knowledge or consent.
by express contract.
by conduct of the principal and agent.
by ratification.
4
Partners are jointly liable for all debts and obligations of the partnership.
True
False
5
It is possible for a corporation to be dissolved by a minority of its shareholders.
True
False
6
In a derivative action, the cause of action belongs to the individual shareholder.
False
True
7
Stock subscriptions may be used at any time during the life of a corporation to add new shareholders to the corporation.
True
False
8
The process of paying the debts of the corporation and distributing its assets is often referred to as the corporate
distribution.
liquidation.
dissolution.
termination.
9
A corporation may be a partner of a limited partnership.
False
True
10
The Securities and Exchange Commission is headed by 12 elected officials, known as commissioners.
False
True
11
The laws of the foreign state govern the internal affairs of the foreign corporation.
True
False
12
A limited liability company is formed when
the articles of organization are filed with the secretary of state.
the articles of incorporation are filed with the secretary of state.
all members sign the certificate of organization.
the articles of organization are signed.
13
Articles of dissolution are filed with the secretary of state to dissolve a corporation.
False
True
14
A certificate of assumed name is filed to
create a trademark.
form an assumed-name entity.
form a sole proprietorship.
give notice of your intent to transact business under a different name.
15
Agency is a relationship in which
a written contract must specify all authority of the agent.
the principal becomes personally liable for all actions of the agent.
the agent acts for or represents the principal by the principal's authority
the principal acts on behalf of the agent.
16
A limited liability company must have three or more members.
False
True
17
Partners are liable for the personal debts of an insolvent partner.
False
True
18
Limited liability partnerships are formed when the partners sign a limited liability agreement.
False
True
19
Partners may purchase insurance to cover many potential liabilities.
False
True
20
Securities that represent loans to the corporation that must be repaid are referred to as
equity securities
par value securities
redeemable securities
debt securities
21
Unlike most contracts, consideration need not be exchanged to form an agency relationship.
False
True
22
Under certain circumstances, a corporation may not be allowed to use its name in the foreign state.
True
False
23
The instrument that represents the right to receive a fraction of a share is referred to as a
scrip
dividend certificate
stock dividend
fractional share certificate
24
When hiring an employee, the sole proprietor must
file a certificate of assumed name.
amend the business's certificate of assumed name.
obtain a federal employer identification number.
file a notice with the secretary of state or other appropriate official.
25
Partners act as agents for the partnership and the other partners.
True
False
26
A sole proprietorship is considered to be
any business org that is owned, managed, & operated by only one individual.
an entity formed to protect the small businessperson from personal liabilit
an extension of the individual sole proprietor.
an entity that is easily transferred from one individual to another.
27
The primary source of business corporation law is
federal statutes.
common law.
the statutes of the corporation's state of domicile.
the IRS code.
28
All members of a limited liability company must be individuals.
True
False
29
Under the Uniform Partnership Act, partners do not have the right to
inspect the books and records of the partnership.
receive a salary paid by the partnership.
an equal share in the profits of the partnership.
participate in the management of the partnership.
30
The issuance of stock of a corporation sometimes requires shareholder approval.
False
True
31
An agent's duties to the principal include
the duty of loyalty.
the duty to compensate the principal.
the duty to perform any tasks requested by the principal.
the duty to act without compensation.
32
The name ___ would probably not be an acceptable corporate name.
ABC Furniture Rental
ABC Furniture, Inc.
ABC Furniture Company
ABC Furniture, Incorporated
33
Most statutory mergers must be approved by the
surviving corporation's board of directors.
president of the surviving corporation.
shareholders of the merging and surviving corporations.
merging corporation's officers.
34
Statutes that allow courts to exercise jurisdiction over nonresident defendants are often referred to as
door-closing statutes.
long-arm statutes.
foreign corporation statutes.
foreign court statutes.
35
The type of merger whereby the parent corporation is merged into a subsidiary is referred to as a(n)
upstream merger.
subsidiary merger.
downstream merger.
share exchange.
36
Partners must contribute an equal amount to the partnership.
True
False
37
State laws regulating securities are often referred to as
the 1933 State Securities Act.
blue sky laws.
the 1934 State Securities Exchange Act.
red herring laws.
38
No partner of a ltd liability partnership ever has any personal liability for the debts & obligations of the partnership
True
False
39
A bondholder is often considered to be more of a creditor than an owner.
False
True
40
If a merger has no clear business purpose other than to eliminate the minority shareholders, it may be found invalid.
False
True
41
Directors may be removed by the officers of the corporation.
True
False
42
The corporate existence typically begins when the articles of incorporation are signed.
False
True
43
The withdrawal of a general partner is considered to be cause for dissolution of the limited partnership.
False
True
44
The assets of a limited liability company are owned by the
limited liability company managers.
limited liability company itself
designated member.
limited liability company members.
45
The activities performed when winding up the affairs of a dissolving corporation do NOT include
paying the outstanding debts of the corporation.
distributing the remaining assets of the corporation to shareholders.
filing articles of dissolution with the Securities & Exchange Commission.
collecting the assets of the corporation.
46
The statutes of most states provide a list of activities considered to be transacting business in that state.
True
False
47
A stock subscription agreement does NOT usually include the
number and class of the shares subscribed to.
subscriber's name and address.
rules and guidelines for the internal governance of the corporation.
name of the corporation.
48
An apparent agency can be created by the actions of an apparent agent alone, without any action by the principal.
True
False
49
The main source of limited liability company law is
IRS regulation.
uniform law.
state law.
federal law.
50
Both general & limited partnerships
offer limited liability to all partners.
are formed by filing a certificate with the secretary of state.
must include at least one general partner.
must include at least one limited partner.
51
Unlike the stock exchanges, over-the-counter markets are not subject to federal regulation.
False
True
52
A(n) ___ is NOT a type of involuntary dissolution.
administrative dissolution
judicial proceeding by majority shareholders
judicial proceeding by minority shareholders
judicial proceeding by creditors
53
The terms mergers and consolidation are interchangeable.
True
False
54
The limited partnership is generally taxed as a separate entity.
True
False
55
When grounds for an administrative dissolution are found, the corporation is immediately considered to be dissolved.
False
True
56
Corporations are usually required by law to pay dividends
in cash.
on the first day of every month.
quarterly.
from the net earnings or surplus of the corporation.
57
The document that must be furnished to a prospective purchaser of registered securities is referred to as the
prospectus.
registration statement.
Form S-1
securities disclosure statement.
58
All corporations must have their tax year end on December 31.
True
False
59
A sole proprietor may hire any number of employees.
False
True
60
The application for employer identification number must be filed with the
secretary of state
State Unemployment Insurance Department
US Department of Labor
Internal Revenue Service
61
Under the doctrine of respondeat superior, an agent is NOT responsible for torts committed while working for an employer
False
True
62
Sole proprietorship are created and governed by state statute.
False
True
63
A business corporation is not an
organization that can exist perpetually.
organizationwith certain rights and powers granted by statute.
entity that is disregarded for income tax purposes.
entity created by law.
64
In a stock acquisition, the acquiring corporation becomes a subsidiary of the target corporation.
True
False
65
Partners act as agents
for the partnership only when that authority is expressly given.
for third parties when dealing with the partnership.
of the partnership & the other partners when dealing with third parties.
only to the extent that authority is granted in the partnership agreement.
66
Statutory close corporations typically
have more than 50 shareholders.
are managed by the shareholders of the corporation.
may not have restrictions on the transfer of shares of their stock.
are managed by a board of directors with at least five directors.
67
A partnership is not required to have ___ to be valid.
at least two partners
a written partnership agreement
the purpose of earning a profit
partners who co-own the partnership business
68
Advantages to transacting business as a sole proprietorship include
double taxation on the income of sole proprietors.
limits on the sole proprietor's personal liability.
the ease and low cost of starting the business.
the sole proprietor's lack of responsibility for actions by employees.
69
Much of modern corporate law has been derived from the decisions of the courts of Delaware.
True
False
70
The corporation is domiciled in the state in which
the corporation's principal office is located.
the corporation's articles of incorporation are filed.
it transacts the majority of its business.
it holds its meetings of the board of directors.
71
The method of voting that gives minority shareholders the right to cumulate their votes is called
preemptive voting rights.
voting by ballot.
minority shareholder voting.
cumulative voting.
72
A limited liability company is
owned and managed by shareholders.
taxed as a corporation.
considered an aggregate of the company's members.
an unincorporated business organization owned by members.
73
When used in relation to the agency relationship, the master
hires the employee for a specific task which the master is not repsonsible
gives his or her servant full discretion to act on the master's behalf.
retains some control over his or her servant (employee).
is not liable for any actions taken on his or her behalf by the servant.
74
A director's duties to the corporation and shareholders do NOT include a
fiduciary duty.
duty of loyalty.
duty of care.
duty to have firsthand knowledge of all business affairs fo the corporation
75
Misconduct by corporate executives can result in criminal prosecution of both the execs and the corporation.
False
True
76
New general partners may usually be admitted to a limited partnership
with the unanimous written consent of all partners.
by completing an application for admission to limited partnership.
if there is sufficient income to pay the new partner's salary.
by permission of the managing partner.
77
Most states require the articles of incorporation contain the names & addresses of the shareholders of the corporation.
True
False
78
In most states, limited liability partnerships are governed by
the state's limited liability partnership act.
special provisions within the state's business corporation act.
special rules put forth by the secretary of state.
special provisions within the state's uniform partnership act.
79
The interest of a limited partner is considered to be personal property.
True
False
80
The most common method of equity financing is the issuance of common stock in exchange for cash.
True
False
81
Corporations have the right to own property, including real estate, in the corporate name.
False
True
82
The name of the limited liability company must contain language identifying it as a limited liability company.
False
True
