Question 1

Business angels prefer to invest in sole proprietorships.

Accepted Answer

A) True 
 B)False

Question 2

What legal issues can a company face when selling securities to investors? What are some of the misconceptions about stock and securities issuance?

Accepted Answer

a.In general, the securities laws prohib

Question 3

Which of the following criteria must a deal meet in order for it to be eligible for intra-state securities offering exemption from registration?

Accepted Answer

A) Buyers and offerees of the securities have to be residents of one state 
B) The company must be incorporated under the laws of that state 
C) The company offering the securities must have most of its assets in the same state 
D) The company must do the most of its business in the same state 
E) All of the above. 
A) Buyers and offerees of the securities have to be residents of one state 
B) The company must be incorporated under the laws of that state 
C) The company offering the securities must have most of its assets in the same state 
D) The company must do the most of its business in the same state 
E) All of the above.

Question 4

Double taxation is not necessarily a problem for a company.

Accepted Answer

A) True 
 B)False

Question 5

National statutes prohibit employment discrimination on the basis of sex, race, national
origin, religion, sexual orientation, age, and disability.

Accepted Answer

A) True 
 B)False

Question 6

Persuading your co-workers to leave your employer is not very risky, as long as their defections do not impact the company's ability to function and the conversations are occurring after working hours.

Accepted Answer

A) True 
 B)False

Question 7

S corporations have the same restrictions as the LLCs, while allocating profit, loss and control more creatively.

Accepted Answer

A) True 
 B)False

Question 8

A tax-friendly form of stock option is called a _______ .

Accepted Answer

A) pension 
B) incentive stock option 
C) phantom stock 
D) municipal stock option 
E) None of the above. 
A) pension 
B) incentive stock option 
C) phantom stock 
D) municipal stock option 
E) None of the above.

Question 9

Certain states do not enforce non-compete agreements.

Accepted Answer

A) True 
 B)False

Question 10

Some corporations give their boards of directors the authority to bind the companies into contracts.

Accepted Answer

A) True 
 B)False

Question 11

As can be learned from the chapter, a redemption agreement is the covenant, in which:

Accepted Answer

A) The business owns insurance policies on the owners and is obligated to use the proceeds to purchase each stockholder's equity upon his or her death. 
B) Each owner is required to take out insurance on the others and to buy a proportional amount of the deceased's equity. 
C) Business assets, such as inventory or marketable securities, equal to the value of owner's share of the equity in the company will be transferred to relatives upon his or her death. 
D) Internal Revenue Service allows installment tax payments to be received within 2 years after an owner's death. 
E) None of the above. 
A) The business owns insurance policies on the owners and is obligated to use the proceeds to purchase each stockholder's equity upon his or her death. 
B) Each owner is required to take out insurance on the others and to buy a proportional amount of the deceased's equity. 
C) Business assets, such as inventory or marketable securities, equal to the value of owner's share of the equity in the company will be transferred to relatives upon his or her death. 
D) Internal Revenue Service allows installment tax payments to be received within 2 years after an owner's death. 
E) None of the above.

Question 12

The corporate opportunity doctrine basically claims that a director cannot use his position to decide which acquisition deals the company should enter to.

Accepted Answer

A) True 
 B)False

Question 13

When choosing an official name, every company has to receive an approval from its respective state regulatory board.

Accepted Answer

A) True 
 B)False

Question 14

If a business is not able to pay its debts, under a general partnership, the debt is transferred to the owners.

Accepted Answer

A) True 
 B)False

Question 15

In the context of this chapter, IRC stands for:

Accepted Answer

A) Investment Recovery Center 
B) International Residential Code 
C) International Relations Center 
D) Initial Ready Company 
E) Internal Revenue Code 
A) Investment Recovery Center 
B) International Residential Code 
C) International Relations Center 
D) Initial Ready Company 
E) Internal Revenue Code

Question 16

Although formally there is only one owner in the sole proprietorship, two or more people control the company.

Accepted Answer

A) True 
 B)False

Question 17

How can the employer motivate its key employees to stay in a startup company?

Accepted Answer

a.Promote/promise pr

Question 18

An employer may not discriminate against anyone for any of the following characteristics, except for:

Accepted Answer

A) Religion 
B) Age 
C) National origin 
D) Sexual orientation 
E) Disability 
A) Religion 
B) Age 
C) National origin 
D) Sexual orientation 
E) Disability

Question 19

The "Internet bubble" bust caused many law firms to refuse equity as payment for legal fees.

Accepted Answer

A) True 
 B)False

Question 20

How can a company protect itself from its employees competing against the company after they leave? What problems may the company face when preventing this kind of competition?

Accepted Answer

a.Require employees to sign a non-disclo

Business angels prefer to invest in sole proprietorships.

What legal issues can a company face when selling securities to investors? What are some of the misconceptions about stock and securities issuance?

Which of the following criteria must a deal meet in order for it to be eligible for intra-state securities offering exemption from registration?

Double taxation is not necessarily a problem for a company.

National statutes prohibit employment discrimination on the basis of sex, race, national origin, religion, sexual orientation, age, and disability.

Persuading your co-workers to leave your employer is not very risky, as long as their defections do not impact the company's ability to function and the conversations are occurring after working hours.

S corporations have the same restrictions as the LLCs, while allocating profit, loss and control more creatively.

A tax-friendly form of stock option is called a _______ .

Certain states do not enforce non-compete agreements.

Some corporations give their boards of directors the authority to bind the companies into contracts.

As can be learned from the chapter, a redemption agreement is the covenant, in which:

The corporate opportunity doctrine basically claims that a director cannot use his position to decide which acquisition deals the company should enter to.

When choosing an official name, every company has to receive an approval from its respective state regulatory board.

If a business is not able to pay its debts, under a general partnership, the debt is transferred to the owners.

In the context of this chapter, IRC stands for:

Although formally there is only one owner in the sole proprietorship, two or more people control the company.

How can the employer motivate its key employees to stay in a startup company?

An employer may not discriminate against anyone for any of the following characteristics, except for:

The "Internet bubble" bust caused many law firms to refuse equity as payment for legal fees.

How can a company protect itself from its employees competing against the company after they leave? What problems may the company face when preventing this kind of competition?

The Power of Entrepreneurship

The Entrepreneurial Process

Opportunity Recognition, Shaping, and Reshaping

Understanding Your Business Model and Developing Your Strategy

Entrepreneurial Marketing

Building the Founding Team

The Business Planning Process

Building Your Pro Forma Financial Statements

Facing Entrepreneurial Ventures Worldwide

Raising Money for Starting and Growing Businesses

Debt and Other Forms of Financing

Entrepreneurial Growth

Social Entrepreneurship: an Overview

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Exam 12: Legal and Tax Issues, Including Intellectual Property

Business angels prefer to invest in sole proprietorships.

What legal issues can a company face when selling securities to investors? What are some of the misconceptions about stock and securities issuance?

Which of the following criteria must a deal meet in order for it to be eligible for intra-state securities offering exemption from registration?

Double taxation is not necessarily a problem for a company.

National statutes prohibit employment discrimination on the basis of sex, race, national origin, religion, sexual orientation, age, and disability.

Persuading your co-workers to leave your employer is not very risky, as long as their defections do not impact the company's ability to function and the conversations are occurring after working hours.

S corporations have the same restrictions as the LLCs, while allocating profit, loss and control more creatively.

A tax-friendly form of stock option is called a _______ .

Certain states do not enforce non-compete agreements.

Some corporations give their boards of directors the authority to bind the companies into contracts.

As can be learned from the chapter, a redemption agreement is the covenant, in which:

The corporate opportunity doctrine basically claims that a director cannot use his position to decide which acquisition deals the company should enter to.

When choosing an official name, every company has to receive an approval from its respective state regulatory board.

If a business is not able to pay its debts, under a general partnership, the debt is transferred to the owners.

In the context of this chapter, IRC stands for:

Although formally there is only one owner in the sole proprietorship, two or more people control the company.

How can the employer motivate its key employees to stay in a startup company?

An employer may not discriminate against anyone for any of the following characteristics, except for:

The "Internet bubble" bust caused many law firms to refuse equity as payment for legal fees.

How can a company protect itself from its employees competing against the company after they leave? What problems may the company face when preventing this kind of competition?

The Power of Entrepreneurship

The Entrepreneurial Process

Opportunity Recognition, Shaping, and Reshaping

Understanding Your Business Model and Developing Your Strategy

Entrepreneurial Marketing

Building the Founding Team

The Business Planning Process

Building Your Pro Forma Financial Statements

Facing Entrepreneurial Ventures Worldwide

Raising Money for Starting and Growing Businesses

Debt and Other Forms of Financing

Entrepreneurial Growth

Social Entrepreneurship: an Overview

Filters