Question 1

Finn and Glenda want to form and do business as Hobby Crafts Corporation. A corporation is

Accepted Answer

A)  ​a natural person. 
B)  ​a tangible thing. 
C)  ​an artificial being. 
D)  ​a visible contemplation. 
A)  ​a natural person. 
B)  ​a tangible thing. 
C)  ​an artificial being. 
D)  ​a visible contemplation. C

Question 2

Pro Audio, Inc., would like to change its corporate status to that of an S corporation. To qualify, Pro Audio must​

Accepted Answer

A)  ​be a domestic corporation. 
B)  ​have more than one hundred shareholders. 
C)  ​be a benefit corporation. 
D)  ​all of the choices. 
A)  ​be a domestic corporation. 
B)  ​have more than one hundred shareholders. 
C)  ​be a benefit corporation. 
D)  ​all of the choices. A

Question 3

Rita and Susan want to form and do business as Trips & Travel, Inc. They will serve as the firm's directors and officers, and will initially hold all of the stock in the company. A corporation is owned by

Accepted Answer

A)  ​the board of directors. 
B)  ​the officers. 
C)  ​the employees. 
D)  ​the shareholders. 
A)  ​the board of directors. 
B)  ​the officers. 
C)  ​the employees. 
D)  ​the shareholders. D

Question 4

​An alien corporation is a corporation formed by a local corporation's competitor.

Accepted Answer

A) True 
 B)False

Question 5

Ned and Olsen want to form and do business as a corporation-Pastries & Pies Inc. Its existence depends generally on

Accepted Answer

A)  ​city or county corporate codes. 
B)  ​the Entrepreneur's Corporate Handbook. 
C)  ​the federal Administrative Procedure Act. 
D)  ​state law. 
A)  ​city or county corporate codes. 
B)  ​the Entrepreneur's Corporate Handbook. 
C)  ​the federal Administrative Procedure Act. 
D)  ​state law.

Question 6

The true ownership of a corporation is represented by common stock.

Accepted Answer

A) True 
 B)False

Question 7

Venture capital is capital provided to new business ventures by professional, outside investors.

Accepted Answer

A) True 
 B)False

Question 8

A corporation is not liable for the misconduct of its agents, officers, or employees.

Accepted Answer

A) True 
 B)False

Question 9

Burgers & Brews, Inc., files its articles of incorporation with the appropriate government agency. Not likely to appear in the articles is the name of

Accepted Answer

A)  ​each incorporator. 
B)  ​each shareholder. 
C)  ​the corporation. 
D)  ​a registered agent. 
A)  ​each incorporator. 
B)  ​each shareholder. 
C)  ​the corporation. 
D)  ​a registered agent.

Question 10

The incorporation of the town of Halfway, Oregon, is approved by the state. Halfway is

Accepted Answer

A)  ​a publicly held corporation. 
B)  ​a public corporation. 
C)  ​a private corporation. 
D)  ​not a corporation. 
A)  ​a publicly held corporation. 
B)  ​a public corporation. 
C)  ​a private corporation. 
D)  ​not a corporation.

Question 11

PrimarySource.com Corporation is a new online, textbook, and school supply business. How can PrimarySource.com obtain capital to finance its operations?

Accepted Answer

Generally, to obtain capital, a corporat

Question 12

Express powers of a corporation can be found in state corporation statutes.

Accepted Answer

A) True 
 B)False

Question 13

Allen wants Wilderness Outfitters to join with him to form and do business as Canyon River Rafting Corporation. A corporation can be owned by

Accepted Answer

A)  ​natural persons only. 
B)  ​other businesses only. 
C)  ​other businesses or natural persons. 
D)  ​none of the choices. 
A)  ​natural persons only. 
B)  ​other businesses only. 
C)  ​other businesses or natural persons. 
D)  ​none of the choices.

Question 14

The shares of Home Mortgage Corporation are publicly traded in securities markets. Home Mortgage Corporation is

Accepted Answer

A)  ​a close corporation. 
B)  ​a privately held corporation. 
C)  ​a public corporation. 
D)  ​a publicly held corporation. 
A)  ​a close corporation. 
B)  ​a privately held corporation. 
C)  ​a public corporation. 
D)  ​a publicly held corporation.

Question 15

The corporation is a creature of statute.

Accepted Answer

A) True 
 B)False

Question 16

Rob owns Solar Panels Corporation. He uses Solarl's funds to pay his personal expenses, creates Thermal Power Inc. to engage in the same business as Solar, transfers Solar's assets to Thermal, and petitions Solar into bankruptcy. This most likely warrants

Accepted Answer

A)  ​a bonus to Rob for financial maneuvers. 
B)  ​a discharge for Solar in bankruptcy. 
C)  ​a pierce of the corporate veil. 
D)  ​a review of Thermal's articles of incorporation. 
A)  ​a bonus to Rob for financial maneuvers. 
B)  ​a discharge for Solar in bankruptcy. 
C)  ​a pierce of the corporate veil. 
D)  ​a review of Thermal's articles of incorporation.

Question 17

A corporate director "owns" the corporation.

Accepted Answer

A) True 
 B)False

Question 18

Interstate Paving, Inc., issues bonds. Bonds​

Accepted Answer

A)  ​are issued by businesses only. 
B)  ​are referred to as fixed-income securities. 
C)  ​feature voting rights. 
D)  ​require periodic interest payments from their owners. 
A)  ​are issued by businesses only. 
B)  ​are referred to as fixed-income securities. 
C)  ​feature voting rights. 
D)  ​require periodic interest payments from their owners.

Question 19

In many states, close corporations have more flexibility in determining their rules of operation.

Accepted Answer

A) True 
 B)False

Question 20

A court will not pierce the corporate veil of a corporation simply because it is too thinly capitalized.

Accepted Answer

A) True 
 B)False

Exam 39: Corporate Formation and Financing

Finn and Glenda want to form and do business as Hobby Crafts Corporation. A corporation is

Pro Audio, Inc., would like to change its corporate status to that of an S corporation. To qualify, Pro Audio must​

Rita and Susan want to form and do business as Trips & Travel, Inc. They will serve as the firm's directors and officers, and will initially hold all of the stock in the company. A corporation is owned by

​An alien corporation is a corporation formed by a local corporation's competitor.

Ned and Olsen want to form and do business as a corporation-Pastries & Pies Inc. Its existence depends generally on

The true ownership of a corporation is represented by common stock.

Venture capital is capital provided to new business ventures by professional, outside investors.

A corporation is not liable for the misconduct of its agents, officers, or employees.

Burgers & Brews, Inc., files its articles of incorporation with the appropriate government agency. Not likely to appear in the articles is the name of

The incorporation of the town of Halfway, Oregon, is approved by the state. Halfway is

PrimarySource.com Corporation is a new online, textbook, and school supply business. How can PrimarySource.com obtain capital to finance its operations?

Express powers of a corporation can be found in state corporation statutes.

Allen wants Wilderness Outfitters to join with him to form and do business as Canyon River Rafting Corporation. A corporation can be owned by

The shares of Home Mortgage Corporation are publicly traded in securities markets. Home Mortgage Corporation is

The corporation is a creature of statute.

Rob owns Solar Panels Corporation. He uses Solarl's funds to pay his personal expenses, creates Thermal Power Inc. to engage in the same business as Solar, transfers Solar's assets to Thermal, and petitions Solar into bankruptcy. This most likely warrants

A corporate director "owns" the corporation.

Interstate Paving, Inc., issues bonds. Bonds​

In many states, close corporations have more flexibility in determining their rules of operation.

A court will not pierce the corporate veil of a corporation simply because it is too thinly capitalized.

Law and Legal Reasoning

Courts and Alternative Dispute Resolution

Court Procedures

Business and the Constitution

Business Ethics

Tort Law

Strict Liability and Product Liability

Intellectual Property Rights

Internet Law, Social Media, and Privacy

Criminal Law and Cyber Crime

Nature and Terminology

Agreement in Traditional and E-Contracts

Consideration

Capacity and Legality

Mistakes, Fraud, and Voluntary Consent

The Writing Requirement in Our Digital World

Third Party Rights

Performance and Discharge

Breach of Contract and Remedies

The Formation of Sales and Lease Contracts

Title, Risk, and Insurable Interest

Performance and Breach of Sales and Lease Contracts

Warranties

International and Space Law

Negotiable Instruments

Transferability and Holder in Due Course

Liability, Defenses, and Discharge

Banking in the Digital Age

Creditors Rights and Remedies

Secured Transactions

Bankruptcy Law

Agency Formation and Duties

Agency Liability and Termination

Employment, Immigration, and Labor Law

Employment Discrimination

Small Businesses and Franchises

All Forms of Partnerships

Limited Liability Companies and Special Business Forms

Corporate Directors, Officers, and Shareholders

Mergers and Takeovers

Investor Protection, Insider Trading, and Corporate Governance

Administrative Agencies

Consumer Law

Environmental Protection

Antitrust Law

Professional Liability and Accountability

Personal Property and Bailments

Real Property and Landlord-Tenant Law

Insurance

Wills and Trusts

The Legal Environment of Business

Torts and Crimes

Contracts and E-Contracts

Domestic and International Sales and Lease Contracts

Negotiable Instruments

Creditors Rights and Bankruptcy

Agency and Employment

Business Organizations

Government Regulation

Pro Audio, Inc., would like to change its corporate status to that of an S corporation. To qualify, Pro Audio must

An alien corporation is a corporation formed by a local corporation's competitor.

Interstate Paving, Inc., issues bonds. Bonds