Question 1

Proxy solicitation for shareholder votes cannot be made by electronic transmission.

Accepted Answer

A) True 
 B)False

Question 2

A derivative lawsuit is brought by the board of directors on behalf of the corporation.

Accepted Answer

A) True 
 B)False

Question 3

A buy-and-sell agreement allows shareholders to sell their shares to people other than fellow shareholders or the corporation.

Accepted Answer

A) True 
 B)False

Question 4

What is the CEO and CFO provision laid out by the Sarbanes-Oxley Act of 2002?

Accepted Answer

The chief executive officer (CEO) and ch

Question 5

Which of the following is true about dividends?

Accepted Answer

A)  Dividends are paid at the discretion of the shareholders. 
B)  Dividends cannot be used for corporate purposes. 
C)  Dividends are paid to shareholders who have sold their shares prior to the record date. 
D)  Dividends once declared, cannot be revoked. 
A)  Dividends are paid at the discretion of the shareholders. 
B)  Dividends cannot be used for corporate purposes. 
C)  Dividends are paid to shareholders who have sold their shares prior to the record date. 
D)  Dividends once declared, cannot be revoked.

Question 6

What is the supramajority voting requirement for shareholders?

Accepted Answer

The articles of incorporation or the byl

Question 7

Once declared, a cash or property dividend cannot be revoked.

Accepted Answer

A) True 
 B)False

Question 8

Inkilwas Corporation has 30,000 outstanding shares. A shareholders' meeting is duly called to amend the articles of incorporation, and 17,501 shares are represented at the meeting. If an Inkilwas Corporation amendment for its articles of incorporation is put to vote at this meeting, which of the following statements is true with respect to the passing of the amendment?

Accepted Answer

A)  The amendment would not be passed as all 30,000 votes have to be represented. 
B)  The amendment would be passed only if all 17,501 votes approve. 
C)  The amendment would be passed if 4,376 votes approve. 
D)  The amendment would be passed if 8,751 votes approve. 
A)  The amendment would not be passed as all 30,000 votes have to be represented. 
B)  The amendment would be passed only if all 17,501 votes approve. 
C)  The amendment would be passed if 4,376 votes approve. 
D)  The amendment would be passed if 8,751 votes approve.

Question 9

Self-dealing is when shareholders use their position to deprive the board of directors of personal monetary gain.

Accepted Answer

A) True 
 B)False

Question 10

A lawsuit a shareholder brings against an offending party on behalf of a corporation when the corporation itself fails to bring the lawsuit is known as a ________.

Accepted Answer

A)  notice of the shareholder 
B)  derivative action 
C)  class action suit 
D)  contract action 
A)  notice of the shareholder 
B)  derivative action 
C)  class action suit 
D)  contract action

Question 11

Kinderfelt Corporation has 15,000 outstanding shares of which Gordon owns 2,000. Kinderfelt plans to raise more capital by issuing another 10,000 shares of stock. With preemptive rights, how many of the new shares does Gordon have the right to buy before they are sold to the public?

Accepted Answer

A)  10,000 
B)  3,000 
C)  5,000 
D)  2,000 
A)  10,000 
B)  3,000 
C)  5,000 
D)  2,000

Question 12

An annual shareholders' meeting is held to elect new shareholders.

Accepted Answer

A) True 
 B)False

Exam 37: Corporate Governance and the Sarbanes-Oxley Act

Proxy solicitation for shareholder votes cannot be made by electronic transmission.

A derivative lawsuit is brought by the board of directors on behalf of the corporation.

A buy-and-sell agreement allows shareholders to sell their shares to people other than fellow shareholders or the corporation.

What is the CEO and CFO provision laid out by the Sarbanes-Oxley Act of 2002?

Which of the following is true about dividends?

What is the supramajority voting requirement for shareholders?

Once declared, a cash or property dividend cannot be revoked.

Self-dealing is when shareholders use their position to deprive the board of directors of personal monetary gain.

A lawsuit a shareholder brings against an offending party on behalf of a corporation when the corporation itself fails to bring the lawsuit is known as a ________.

Kinderfelt Corporation has 15,000 outstanding shares of which Gordon owns 2,000. Kinderfelt plans to raise more capital by issuing another 10,000 shares of stock. With preemptive rights, how many of the new shares does Gordon have the right to buy before they are sold to the public?

An annual shareholders' meeting is held to elect new shareholders.

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