Exam 32: Corporate Formation and Financing

Hudson and Ilka want to market a new line of kayaks and related gear under the brand name Journeys as a corporation-Journeys,Inc.To avoid income taxes at the corporate level,they should form

The Revised Model Business Corporation Act gives a close corporation less flexibility than other corporations in determining its rules of operation.

Tech Personnel,Inc.,is a corporation.Tech Personnel's implied powers enable it to

Preferred stock is an equity security with preferences.

Orel incorporates his business as Posts & Wire Corporation in Texas.He and his group of shareholders intend to make a profit from their sales of fencing materials.Posts & Wire is

Voting rights in a corporation apply only to the election of the firm's board of directors.

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

Bonds represent the borrowing of funds by firms.

A foreign corporation normally does not need a certificate of authority to sell goods or services via the Internet or by mail.

Miracle Mobile Devices,Inc.,is a private,for-profit corporation that (1)was formed for the purpose of manufacturing and distributing a newly patented tablet,(2)is owned by five shareholders,(3)is subject to double taxation,and (4)has made no public offering of its shares.Miracle is

A corporation has perpetual existence unless the articles of incorporation state otherwise.

Dollars & Sense,Inc.,is incorporated in the state of New Jersey and is doing business in the state of New York.In New York,Dollars & Sense is properly referred to as

Dennis is a promoter for the soon-to-be-incorporated firm of eBroadcast Sports,Inc.Dennis signs a contract with Fitz & Geraldo,Accountants,to render their services before eBroadcast Sports is incorporated and for one year after the incorporation.eBroadcast Sports is incorporated.Three months later,after Fitz & Geraldo has continued performing under the contract,the eBroadcast Sports board of directors tells the accountants that it is canceling their contract.Fitz & Geraldo files a suit against Dennis and eBroadcast Sports,alleging breach of contract.Will Fitz & Geraldo prevail

The abbreviation "P.A." in the name "Conrad & Drake,Accountants,P.A." means that this organization is

Blair and Chanel are holders of common stock in Discount Retail Stores,Inc.Like other holders of common stock,they have a residual position in the overall financial structure of Discount Retail,because they

When a corporation earns profits,it must pass them on to shareholders in the form of dividends.

Urban Commerce,Inc.,issues bonds,which are also known as

If a corporation has S corporation status,it can avoid the imposition of income taxes at the corporate level.

Bay City Merchants Corporation has six shareholders,four of whom are members of the same family.All of Bay City's shareholders agree in writing to operate without shareholders' meetings.Under the Revised Model Business Corporation Act,this most likely warrants

Memphis Music Makers Inc.'s stated purpose is to sell musical instruments.If chief executive officer Neal contracts with Open Season Firearms in Memphis Music's name to sell a shotgun,he has likely committed